Bosch India Hit with Rs 96 crore Customs Fine Over Alleged Misclassified Auto Parts

Bosch Ltd., the Indian subsidiary of the German engineering and technology giant, has been slapped with a hefty customs duty and penalty totalling nearly Rs 96 crore by Customs authorities over alleged misclassification of auto components and wrongful duty claims.

"The company believes it has a strong case on merits as the order passed is arbitrary and non-speaking. The company is availing itself of all legal remedies permitted under the law." the company spokesperson said. 

The order, passed on July 2 by the Principal Commissioner of Customs (Import) at Mumbai’s Air Cargo Complex, relates to a long-standing dispute on the classification of imported Electronic Control Units (ECUs) and Oxygen Nox Sensors. The ruling accuses the company of incorrectly availing duty exemptions and misclassifying goods under preferential tariff codes. 

 However, Bosch has informed about the development in a regulatory filing. 

According to the order, Bosch Ltd. allegedly claimed undue benefits under Notification No. 50/2017-Customs for imports including Rot Speed Sensors, Knock Sensors, and Phase Sensors. Officials also flagged incorrect classification of ECUs under Customs Tariff Item (CTI) 9032.89.10 or 9032.89.90, which should have fallen under Chapter Heading (CTH) 8708.99.00. Similarly, the Oxygen Nox Sensors were found to be wrongly declared under multiple headings, whereas authorities claim they should have been categorized under CTH 9031.80.00.

As a result, the Customs Department has demanded a differential duty of Rs 66.72 crore and imposed an additional penalty of Rs 29.58 crore.