Customs & FTP Litigation, CESTAT Representation: The Process, Start to Finish
The mechanics of Customs & FTP Litigation, CESTAT Representation are what clients ask about once they have decided to proceed. The questions below are the ones raised most often in practice; the full scope of the service is on the Customs & FTP Litigation, CESTAT Representation page.
I just received a summons under Section 108 of the Customs Act. What should I do first?
Do not ignore it, and do not attend without preparation. A Section 108 summons requires the person summoned to appear and give a statement — statements recorded under Section 108 are treated as admissible evidence and can be used against the business at every subsequent stage. The first step is understanding precisely what the investigation is about, what documents are being sought, and preparing the individual who will appear. This is materially different from responding to a Show Cause Notice, which is a written pleading rather than an oral examination.
In practice: It is easy to treat a Section 108 appearance casually, as if it were an informal chat with an official. It is not. What is said in that room becomes part of the permanent evidentiary record of the case.
How long do I have to reply to a Customs Show Cause Notice?
The SCN itself specifies the reply period — commonly 30 days from receipt, though this can vary and the notice should always be checked for its specific deadline. Extensions are at the discretion of the adjudicating authority and are not guaranteed, particularly where the department believes the matter involves deliberate evasion. A reply filed after the stated period, without a granted extension, risks the matter proceeding ex-parte — meaning an order passed without full consideration of the business's position.
In practice: We request an extension formally and promptly if genuinely needed for document assembly — silence past the deadline is far riskier than a reasoned, documented extension request made before the deadline expires.
What is the pre-deposit requirement for filing a customs appeal, and can it be waived?
Section 129E requires a deposit of 7.5% of the duty (or of the penalty where penalty alone is in dispute) for an appeal to the Commissioner (Appeals), and 10% of the duty or penalty for a further appeal to CESTAT against the Commissioner (Appeals) order, subject to a ceiling set in the Act on the amount required to be deposited; confirm the current figure with the official source. The pre-deposit is mandatory and cannot be waived.
In practice: Businesses sometimes plan around the old discretionary-stay system from memory, not realising the current regime makes pre-deposit mandatory. We factor this cash requirement into the litigation-versus-settlement decision from the outset, since it is a real cost regardless of how strong the case is.
What is CESTAT and how does a matter get there?
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) is the specialised appellate tribunal that hears appeals against orders of the Commissioner (Appeals), and certain matters directly against orders of the Principal Commissioner/Commissioner as an adjudicating authority, under Section 129A of the Customs Act. It functions as the final fact-finding forum in most customs matters — meaning it is generally the last stage at which new evidence and factual arguments are fully examined, since a further appeal lies to the High Court under Section 130 on substantial questions of law, or directly to the Supreme Court under Section 130E where the dispute concerns the rate of duty or the value of goods.
In practice: Because CESTAT is effectively the last forum that re-examines facts, we treat CESTAT preparation with the same seriousness as trial preparation in civil litigation — the paper-book, the evidence, and the arguments made here largely determine whether a further appeal, if needed, has any realistic prospect.
What is Special Valuation Branch (SVB) scrutiny and how does it lead to litigation?
SVB is a specialised Customs unit that investigates the declared transaction value of imports between related parties, because a group or common-control relationship between buyer and seller can, in principle, allow the declared price to be manipulated relative to an arm's-length price. If SVB determines the relationship has influenced the price, it can load the assessable value, leading to a duty demand — which the importer can then contest through the normal Order-in-Original, Commissioner (Appeals), and CESTAT route if the finding is disputed.
In practice: SVB cases often run for a long time even before formal litigation begins — proceedings can extend well past a year during the investigation phase, sometimes with provisional assessment and Extra Duty Deposit in the interim. We advise clients to build a defensible valuation position proactively, well before a reference is made, rather than only after the loading order is passed.
What is the Denied Entity List and how serious is placement on it?
DGFT maintains a Denied Entity List of persons and businesses barred from directly or indirectly importing or exporting, typically following a serious FTP violation such as a proven case of fraudulent licence utilisation or serious export obligation default. Placement is a severe outcome — it halts the ability to trade entirely, not merely one specific licence or shipment. A business facing a proceeding that could lead to Denied Entity List placement needs the strongest possible representation at the show-cause stage, since resisting the underlying finding is far more effective than contesting the listing after it has been imposed.
In practice: We treat any DGFT proceeding that references potential Denied Entity List action as a top-priority matter from the moment it surfaces — the operational consequence of listing is disproportionately severe compared to most other FTP penalties, and the time to prevent it is before the order, not after.
How much does customs litigation representation cost?
Fees depend entirely on the stage, complexity, and forum of the matter — a Show Cause Notice reply is scoped very differently from a multi-year CESTAT appeal or a Supreme Court matter involving briefed senior counsel. PNPC provides a written fee estimate for each stage of the matter before work begins, rather than an open-ended engagement, so the client can make an informed decision on whether to litigate, settle, or accept an adverse order at each decision point.
In practice: We explicitly factor the pre-deposit cash requirement and the realistic litigation timeline into this conversation — the professional fee is only part of the total cost of pursuing an appeal, and we want clients deciding with the full financial picture in view.
How does an ongoing customs dispute affect our GST position?
IGST paid at import is generally available as input tax credit, but a duty demand that increases the assessable value (following an adverse valuation or classification order) can also increase the IGST payable at import, with knock-on implications for input credit timing and reconciliation. Separately, RoDTEP and Duty Drawback claims are reconciled against GST return data, so a customs dispute that changes the underlying Shipping Bill or Bill of Entry data can disturb an otherwise-settled incentive claim.
In practice: We review the GST knock-on effect of any proposed settlement or litigation outcome before finalising a position — a customs-side win or loss rarely stays contained to the customs side alone, and we want the full financial picture assessed together.
What is the practical first step to engage PNPC for customs or FTP litigation?
Send us the triggering document — the summons, notice, or order — as soon as it is received, along with the date of receipt. We will confirm the applicable deadline immediately, give an initial assessment of what is at stake, and scope the engagement and fee in writing before work begins in earnest. There is no requirement to have every supporting document assembled before this first conversation.
In practice: The single most useful thing a client can do in the first phone call is simply forward the document itself, rather than summarising it verbally — the exact wording of an SCN or order materially changes our reading of what is actually being alleged and what deadline genuinely applies.
Where this sits in the wider engagement
Customs & FTP Litigation, CESTAT Representation rarely arrives on its own. The statutory basis and the current requirements are set out on the Customs & FTP Litigation, CESTAT Representation service page, and the related services are grouped under Fema Rbi.
What PNPC does
PNPC Global has practised since 1986 across India and the UAE. On Customs & FTP Litigation, CESTAT Representation we take the work end to end — reviewing the facts, preparing and filing what is required, and dealing with the authority through to closure.