CESTAT Sets Aside Late Fee on Supplementary Bills of Entry, Grants Relief to Agarwal Coal Corporation

June 16, 2026 : the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata Bench, has set aside the late fees imposed on M/s Agarwal Coal Corporation Pvt. Ltd. for filing supplementary Bills of Entry relating to excess quantities of imported coal. The Tribunal held that the delay was not attributable to any fault on the part of the importer and that customs authorities possess the discretion to waive such charges in deserving cases.

The dispute arose after Agarwal Coal Corporation imported multiple consignments of steam coal through Paradip Port and filed the original Bills of Entry within the statutory time prescribed under Section 46 of the Customs Act, 1962. After the cargo had already been cleared, draft survey reports revealed the presence of excess quantities of coal that remained at the port and formed part of the same imported consignments. The company approached customs authorities seeking amendment of the Import General Manifest (IGM) and the corresponding Bills of Entry while expressing its willingness to pay customs duty on the additional quantity discovered.

However, customs authorities did not permit amendment of the already-filed Bills of Entry. As a result, the importer was compelled to file supplementary Bills of Entry covering the excess cargo. Since these supplementary filings were made beyond the statutory timeline, customs authorities imposed late fees under Regulation 4(3) of the Bill of Entry (Electronic Integrated Declaration) Regulations, 2018 read with Section 46(3) of the Customs Act, 1962. Appeals against the levy were rejected by the Commissioner (Appeals), prompting the company to approach the Tribunal.

Before the Tribunal, the appellant argued that the excess quantities related to the same consignments for which timely Bills of Entry had already been filed. The company contended that any delay occurred because the excess cargo was discovered only after the survey process and not due to negligence or deliberate inaction on its part. It further submitted that customs authorities should have either allowed amendment of the existing documents or exercised their statutory discretion to waive the late fee. The appellant also relied upon earlier decisions, including the CESTAT Chennai ruling in Blueleaf Trading Company v. Commissioner of GST & Central Excise, as well as departmental guidelines and a Standard Operating Procedure issued by customs authorities concerning excess cargo handling.

The Revenue defended the levy, maintaining that supplementary Bills of Entry had been filed after the prescribed period and that the customs system had automatically calculated the applicable late fee. According to the department, the delayed filing attracted the statutory charges regardless of the surrounding circumstances.

After examining the record, the Tribunal found that the importer had complied with legal requirements by filing the original Bills of Entry within the stipulated period. The Bench observed that the excess coal discovered during the draft survey was part of the same cargo covered by the original import documents. It concluded that the subsequent filing of supplementary Bills of Entry resulted from post-clearance developments rather than any omission or fault on the part of the importer.

Interpreting Section 46(3) of the Customs Act, the Tribunal emphasized that late fees are not intended to be imposed mechanically. The provision authorizes customs authorities to levy charges for delayed presentation of Bills of Entry only when the proper officer is not satisfied with the reasons for the delay. The Bench stated that the law itself contemplates the possibility of waiver where sufficient cause exists.

In an important observation, the Tribunal held that “the Proper Officer has the authority to waive the late fee in deserving cases” and that “the late filing of the Bills of Entry cannot be attributed due to any act or fault accruing on the part of the appellant.” The Bench further observed that “considering the bona fides of the appellant, the imposition of late fee in the present cases is found to be unwarranted.”

The Tribunal also referred to CBEC Circular No. 14/2017-Customs and the Bhubaneswar Customs Commissionerate’s Standard Operating Procedure dated 19 May 2023. These guidelines stress that penalties and related charges should not be imposed routinely or mechanically and that authorities must consider the specific circumstances of each case before taking adverse action.

Further strengthening its reasoning, the Bench relied on the earlier CESTAT Chennai decision in Blueleaf Trading Company, where it was held that delayed filing charges may be waived when the importer demonstrates a reasonable and bona fide cause for the delay. The Kolkata Bench noted that the principles laid down in that case applied squarely to the present dispute. It also referred to its own earlier decision in Kai International Pvt. Ltd. v. Commissioner of Customs (Preventive), Odisha, where similar late fees had been set aside on identical facts.

The Tribunal clarified that there was no dispute regarding the customs duty paid on the excess coal covered by the supplementary Bills of Entry. Since neither side challenged the duty calculation, the Bench accepted that the applicable customs duty had been correctly paid in accordance with the Customs Act.

Allowing all six appeals, the Tribunal ultimately held that the late fees imposed on Agarwal Coal Corporation were legally unsustainable. The impugned appellate orders were set aside to the extent they upheld the levy, and the importer was granted consequential relief in accordance with law.

The ruling is expected to have wider implications for importers facing similar situations involving excess cargo discovered after clearance. It reinforces the principle that customs authorities must exercise discretion judiciously and cannot automatically impose late fees where delays arise from circumstances beyond the importer’s control. The decision also underscores that procedural compliance should be assessed in light of commercial realities and the bona fide conduct of stakeholders rather than through a purely mechanical application of statutory provisions.

Case Reference: M/s Agarwal Coal Corporation Pvt. Ltd. v. Commissioner of Customs (Preventive), Bhubaneswar, Customs Appeal Nos. 76044, 76049, 76052, 76054, 76061 & 76073 of 2024, CESTAT Kolkata, Final Order Nos. 75694-75699/2026.