W.P. No. 16050 of 2024

C. Solomon Selvaraj vs Principal Commissioner of Customs, Chennai

Date Issued: 26 September 2026
State: Tamil Nadu
Source: HC Madras
Views: 2

Summary

In C. Solomon Selvaraj v. Principal Commissioner of Customs, the High Court of Judicature at Madras allowed the writ petition and set aside Order-in-Original No. 105387/2024, which had held a freight forwarder jointly and severally liable for ₹4,56,00,374 in differential customs duty, interest, and equivalent penalties under Sections 28(4), 114A, and 114AA of the Customs Act, 1962\. The dispute arose from a December 2017 import consignment declared as gas stoves, in which the Directorate of Revenue Intelligence intercepted over 2 crore undeclared sewing machine needles and 70,200 measuring tapes concealed inside the container. The Revenue argued that the petitioner, proprietor of M/s. The Sea Shipping Forwarders, was a beneficial owner and importer because he received shipping documents, instructed the Customs Broker, paid duty from his firm's account, and arranged transport on a lump-sum basis. Rejecting the Department's position, the Court held that routine logistics facilitation does not render a freight forwarder a "beneficial owner" under Section 2(26) or an authorized agent under Section 147(3), emphasizing that mere clearance assistance without cogent evidence of prior knowledge, mens rea, or intentional connivance cannot form the legal basis for imposing duty liabilities or penalties.