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Informative

CESTAT Rules Assessable Value Must Be CIF with Air Freight Limited to 20% of FOB, Not Ex-Works

Update / Judgement Date

28 Aug 2025

Source

Taxscan

Author

Team — WCP Legal Desk

Reading Time

1 min read

Excise, VAT & CustomInternational Taxation

The CESTAT has ruled that the assessable value for customs duty must be "CIF with air freight limited to 20% of FOB, not ex-works." The tribunal's decision is a significant step towards ensuring that the customs duty is calculated correctly. The ruling clarifies that a tax authority can't add a tax to a company's account without a valid reason. The court’s decision is a crucial reminder to all businesses that they must be diligent in their dealings.