The Delhi Bench of Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has set aside a Rs. 20 lakh penalty imposed on luxury carmaker Bentley Motors Ltd. by Indian customs authorities, providing relief to the UK-based manufacturer in a long-running dispute over alleged undervaluation of imported vehicles.
The bench of Dr. Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) has noted that Bentley had fully disclosed supplementary invoices and account adjustments during investigation, showing no intent to conceal facts.
The controversy stemmed from investigations by the Directorate of Revenue Intelligence (DRI), which alleged that Bentley’s Indian dealer, Exclusive Motors Pvt. Ltd., undervalued luxury cars imported into India between 2018 and 2022.
According to the DRI, Exclusive Motors failed to declare supplementary invoices issued by Bentley when cars were shipped by air instead of sea, thereby underreporting the assessable value and evading customs duty.
Based on these findings, the customs authority demanded Rs. 71.74 crore in differential duty and imposed equal penalty on Exclusive Motors, while also holding its executives and Bentley liable.
In July 2024, the Commissioner concluded that 170 Bentley cars were undervalued, making them liable for confiscation. However, as the cars had already been cleared, no redemption fine was imposed.
While Exclusive Motors and its officials had their penalties quashed in November 2024, Bentley’s appeal was heard separately and decided this month.
Bentley argued that the main invoices covered CIF (Cost, Insurance, Freight) values for sea shipments, while supplementary invoices were only issued when air freight was required, which naturally cost more. These supplementary invoices were uploaded online and accessible to Exclusive Motors, but the dealer misrepresented facts before the tribunal by claiming it never received them. Payments for supplementary invoices were not made through fresh remittances but via account adjustments in a running account between Bentley and its dealer — a practice accepted in the automotive industry. As an exporter, Bentley had no role in the customs declarations made by Exclusive Motors in India and therefore could not be penalized for misdeclarations.
The CESTATobserved that since the penalties and confiscation orders against Exclusive Motors and its executives had already been set aside in November 2024, the penalty on Bentley could not be sustained. Even otherwise, Bentley had fully disclosed supplementary invoices and account adjustments during investigation, showing no intent to conceal facts. The company had neither abetted nor committed any act that could render the cars liable to confiscation under Section 111(m) of the Customs Act.
The tribunal ruled that the Rs. 20 lakh penalty was unjustified and must be quashed, allowing Bentley’s appeal in full.
Case Details
Case Title: M/s Bentley Motors Ltd. Versus Commissioner of Customs
Case No.: Customs Appeal No. 52346 Of 2024
Date: 20.08.2025
Counsel For Appellant: Senior Advocate Sujit Ghosh and Advocates Shri Nikhil Varshney, Ms. Rashi Jeph and Ms. Tanya Shukla,
Counsel For Respondent: Rakesh Kumar and Shri Girijesh Kumar, Authorized Representative (DR)
Read More: 14 High Court Judges Transferred Across India: Full List of New Appointments
