The Delhi High Court has called for a response from the Central Vigilance Commission (CVC) regarding allegations of corruption among senior customs officers over the misclassification of betel nuts for customs duty purposes. Justices Prathiba M Singh and Rajneesh Kumar Gupta issued a notice to the CVC following a petition that highlighted potential large-scale duty evasion facilitated by this misclassification.
The bench also instructed the Central Board of Indirect Taxes and Customs (CBIC) to submit a comprehensive affidavit addressing the issues previously raised. This affidavit is expected to clarify any doubts surrounding the customs duty classification of betel nuts and is due within four weeks. The question of the petition’s maintainability will be considered at the next hearing scheduled for May 8.
The petitioner, a customs house agent (CHA) named Bajrang Lal Sharma, argued that the ambiguity over whether betel nuts should be subjected to 100% or 50% basic customs duty has led to widespread misclassification. This alleged misclassification has reportedly resulted in significant financial losses to the government and has enabled importers to evade full duty payment.
Advocate Kamini Lau, representing Sharma, expressed frustration over the repeated harassment faced by CHAs from a group of customs officers. Despite multiple complaints filed with the National Customs Targeting Centre (NCTC) about the misdeclaration and misclassification of imported betel nuts under various labels—such as “boiled supari, API supari, chikni supari, and flavoured supari”—no decisive action has been taken.
These complaints assert that such misclassification has allowed importers to bypass the Minimum Import Price (MIP) conditions set by the Directorate General of Foreign Trade, paying only 50% of the Basic Customs Duty (BCD) instead of the stipulated 100%. Sharma’s complaint to the CVC in March 2022 called for urgent action against a senior customs officer allegedly involved in colluding with others to facilitate these practices, continuing to cause significant revenue losses.
