Delhi HC Restores BSNL’s Time-Barred Customs Appeal; Orders CESTAT to Hear Case on Merits

Bharat Sanchar Nigam Limited (BSNL) appealed under Section 130 of the Customs Act against a CESTAT order dated 28 July 2025 refusing to condone a 652-day delay in filing its statutory appeal. BSNL had imported telecom equipment, Baseband Unit Modules (BBU) and Radio Access Technology (RAT) but later shifted to CTH 85177090 following departmental clarification and directed its units to pay differential duty. SCNs dated 8 July, 9 September, and 16 September 2021 were issued under Section 28(4) alleging wilful misstatement. BSNL replied, and the Adjudicating Authority passed an OIO on 20 February 2023 re-classifying the goods, confirming differential duty (Rs. 12.63 crore), appropriating most of the duty already paid, and imposing an equal penalty under Section 114A.

BSNL then filed a belated appeal before CESTAT nearly 652 days late. The Tribunal found the reasons for delay, internal movement, mistaken belief that the matter had ended, reshuffling, and delayed engagement of counsel to be vague, unsupported, and negligent, concluding that no “sufficient cause” existed. The appeal was thus dismissed solely on the ground of limitation. Aggrieved, this appeal was filed before the High Court.

Main Issue

Whether BSNL’s 652-day delay in filing an appeal before CESTAT should be condoned to allow adjudication on the merits.

Decision

The High Court held that although the CESTAT’s refusal to condone the delay was legally sustainable, the nature of the case warranted a hearing on the merits. The Court noted that BSNL, being a public sector telecom service provider, had voluntarily declared and paid differential duty, and therefore ought not to be denied an opportunity to contest the penalty and extended-period proceedings. Relying on Inder Singh v. State of MP and Siddhi Vinayak Importers, the Court observed that sufficiency of cause must be considered pragmatically when substantial justice is at stake.

Balancing these considerations, the Court condoned the delay subject to BSNL depositing Rs. 20,000 with the Delhi High Court Legal Services Committee within four weeks. Upon deposit, BSNL’s appeal before CESTAT stands restored to its original number for full adjudication on merits. The parties were directed to appear before CESTAT on 9 January 2026.

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