The Bombay High Court has held that an importer cannot be denied exemption from the Steel and Steel Products (Quality Control) Order merely because registration on the Steel Import Monitoring System (SIMS) was sought after June 30, 2026, when the goods were shipped on or before that date and the application met the separately prescribed registration timeline.

A Division Bench of Justices M. S. Karnik and Sandesh D. Patil ruled that the authorities could not impose an additional requirement to generate the registration number before June 30 when neither the applicable notifications nor the law prescribed such a condition.

The bench quashed the Ministry of Steel’s order, which had denied the importer the benefit of the relevant notifications.

Buy Now: 80+ Judgements Indirect Tax – September 2026 E-Magazine

The petitioner/assessee, a proprietorship concern engaged in importing steel tubes and pipes under ITC-HS Code 7304, approached the court after it was unable to generate a registration number on the SIMS portal for consignments imported from Thailand and Ukraine.

The dispute concerned the interaction between two Ministry of Steel measures: a notice dated February 19, 2026, governing advance registration on SIMS, and an order dated April 8, 2026, granting exemption from mandatory compliance with the Quality Control Order for specified steel products.

For imports from countries other than Nepal, Bhutan and Sri Lanka, the February notice permitted registration not earlier than the 60th day and not later than the third day before the expected arrival of the consignment. The Automatic Registration Number generated under the notice remained valid for 75 days.

The April order exempted specified steel imports from mandatory QCO compliance where the bill of lading recorded a “shipped on board” date on or before June 30, 2026.

The importer’s Thailand consignments were shipped on June 27, 2026, while its Ukraine consignment was shipped on May 26, 2026. Both therefore met the shipment cut-off stipulated in the exemption order.

Timely Application Could Not Be Processed On Portal

The importer applied for generation of the registration number on July 3, 2026. The Thailand consignments were expected to arrive on July 12, while the Ukraine consignment was expected later that month.

The court found that the July 3 application fell within the registration window prescribed by the February notice. However, the registration number could not be generated.

The importer lodged a grievance on the Centralised Public Grievance Redress and Monitoring System on July 9, followed by an appeal on July 31. The proceedings culminated in the Ministry’s August 10 order denying relief.

The importer argued that the refusal defeated the Ministry’s own notifications despite compliance with their conditions.

The government maintained that successive exemptions had provided the trade with an adequate transitional period and that the final cut-off had been notified nearly three months in advance.

It argued that the QCO exemption did not dispense with SIMS registration. According to the authorities, an importer seeking the exemption had to register under the Non-QCO import procedure while the transitional exemption remained available.

The government also submitted that registration could have been obtained before June 30 for both consignments. Since the importer first approached the portal on July 3, the authorities considered it ineligible for the exemption.

the court distinguished the shipment condition under the April order from the registration timeline under the February notice.

The April order expressly linked exemption to the “shipped on board” date recorded in the bill of lading. It did not require the registration number to be generated by June 30.

The February notice, meanwhile, linked registration to the expected arrival of the consignment. The court found no legal basis for replacing that timeline with an additional June 30 deadline.

The Bench held that the authorities’ insistence on registration before the expiry of the transitional period was unsupported by the Customs Act or the conditions governing the exemption. The importer’s application on July 3 was therefore within the prescribed time.

The court considered the Supreme Court’s ruling in Commissioner of Customs (Import), Mumbai v. Dilip Kumar & Co., which requires strict interpretation of exemption provisions and places the burden of establishing eligibility on the claimant.

It held that the importer satisfied the applicable conditions even on a strict reading of the notifications.

The Bench also relied on Bombay Chemical (P) Ltd. v. CCE for the principle that, once goods satisfy the eligibility test under an exemption notification, they cannot be excluded by construing the notification narrowly.

Referring to Southern Petrochemical Industries Co. Ltd. v. Electricity Inspector & ETIO, the court discussed the protection of accrued exemption rights where the prescribed conditions have been fulfilled.

The High Court allowed the petition in terms of prayer clauses seeking to quash the August 10 order and secure generation of the registration number to facilitate clearance, or alternatively permit clearance without insistence on a QCO quality certificate.

Membership Required to Access Case Details & Order Copy

To view the complete Case Details and Download Order Copy, you must have an active membership. Please subscribe to continue.

Read More: GST Appeal Can’t Be Dismissed Over Pre-Deposit Shortfall Without Opportunity To Respond: Bombay HC