Authority: Supreme Court of India, Civil Appellate Jurisdiction

Order Date: September 29, 2026

Case Overview

  • Parties: International Air Charter Operations (I) Pvt. Ltd. & others (Appellants) vs Union of India & others (Respondents).
  • Background: The appellants obtained a No Objection Certificate (NOC) on 12.12.2007 for import of an aircraft under Notification dated 03.05.2007, Condition No. 104, permitting use only for Non‑Scheduled Air Transport (passenger) services.
  • The aircraft was cleared with exemption from customs duty. On 17.11.2008 a Show‑Cause Notice was issued alleging operation of charter services, contrary to the permit.
  • Order‑in‑Original dated 29.06.2009 held the appellants liable to pay customs duty of Rs 6,24,50,565/‑ and an equivalent penalty; directors were each liable to pay Rs 25 lakh as penalty.
  • The appellants challenged the order before CESTAT; the appeal was disposed on 04.01.2017, leaving the question of law open and granting liberty to approach CESTAT after the Supreme Court’s decision.
  • The appellants withdrew their civil appeals before the Supreme Court; the pending issues did not fall within Section 130‑E of the Customs Act, leaving the legal question unresolved.
  • Assistant Commissioner (Recovery) issued first demand notice on 30.11.2021. A three‑judge bench of CESTAT decided the law in M/s VRL Logistics Ltd. v. Commissioner of Customs, Ahmedabad on 08.08.2022, holding that “Non‑Scheduled (Passenger) Services” includes charter services.
  • Second demand notice issued on 06.10.2023; the appellants filed a writ petition which the Delhi High Court dismissed on 24.11.2023, stating the Order‑in‑Original had attained finality.
  • The appellants filed a restoration application before CESTAT; on 26.02.2024 CESTAT rejected it, stating liberty from the High Court was required.
  • A Review Petition against the High Court’s order was dismissed on 30.01.2026, with the Court noting the appellants had not availed the liberty granted by CESTAT and had instead filed a petition challenging demand notices.

Final Outcome

  • The Supreme Court set aside the Delhi High Court’s order dated 24.11.2023 and the Review Petition order dated 30.01.2026.
  • It restored Customs Appeal No. 603 of 2009 (originally dated 29.06.2009) to its original number and allowed the appellants to pursue the statutory appeal before CESTAT.
  • The Court directed the CESTAT to take up and dispose of the restored appeal within three months from the date of this order.
  • All pending applications, if any, are stood disposed of.

Topics: Customs Duty, Appeal Restoration