Mangalore Refinery and Petrochemicals Limited (MRPL) has secured a significant legal victory regarding a long-standing customs duty dispute. The Customs Excise and Service Tax Appellate Tribunal (CESTAT) has issued a final order in favor of the company, effectively resolving a potential liability of ₹616.82 crore. This favorable outcome enables the company to claim a refund of ₹212.53 crore previously paid under protest, providing a positive boost to its cash flow position.
Resolution of Customs Duty Dispute
MRPL has received a favorable final order from the Customs Excise and Service Tax Appellate Tribunal (CESTAT), Bangalore, regarding a classification dispute concerning the import of ‘Reformats’. The dispute, which spanned the period from October 2015 to February 2017, centered on the correct customs tariff classification of the imported goods.
Financial Impact and Recovery
The customs authorities had previously raised a total demand of ₹616.82 crore, which included differential basic customs duty, interest, penalties, and a redemption fine. By ruling in favor of MRPL, the tribunal has extinguished this entire contingent liability.
Furthermore, the company is now eligible to recover ₹212.53 crore, representing the amount that was deposited under protest during the investigation. The management has confirmed its intent to file a formal refund application under the provisions of the Customs Act, 1962, within the prescribed statutory timelines to improve the company’s overall liquidity.
Source: BSE
