The government gets dragged to Court by the Importers of Denatured Ethyl Alcohol
The customs department of the government has decided to investigate the classification of imported products. This has caused immense agony among the importers of denatured ethyl alcohol which is used in sanitizers and disinfectants and a constituent used in Ramdesivir. The importers have approached the Bombay High Court to oppose this investigation.
Reading the petition of one of the companies, Satyam Petrochemicals, the court has given an order to the customs department to wait for a week before taking any major step. According to the importers, the department has seized their products that caused a shortage in the raw materials. They have accused the customs department of having seized products that are highly important to make the crucial products used during the pandemic.
The categorization of the products is important for evaluating the tax rate applicable to the products. The importers have been paying the tax at a much lower rate in the name of ‘excisable goods’. They were paying just 2.5% tax over the years. The customs department has asked to pay an additional 2.5%.
The customs department has said that excise is not part of GST. So, the importers should pay the additional tax according to the new regulation of GST.
After the Government got dragged to the Bombay High Court by the importers of denatured ethyl alcohol, the indirect tax department has been asked to present an explanation by the Gujarat High Court.