📢 CBIC Notification No. 35/2025 – Customs (N.T.): New Rules for Adjudicating Notices Against EOUs
By Aaerm Law Associates | May 22, 2025
âś… Overview
On May 16, 2025, the Central Board of Indirect Taxes and Customs (CBIC) released Notification No. 35/2025 – Customs (N.T.). This update provides clear guidance on how to assign show cause notices involving both customs and central excise duty to adjudicating officers for 100% Export Oriented Undertakings (EOUs).
The CBIC aims to simplify the adjudication process. It introduced a structured system based on the amount of duty involved. This structure ensures faster resolution and better jurisdictional clarity.
⚖️ Key Provisions of the Notification
The notification assigns cases based on the total duty amount (customs + excise). Here’s how it breaks down:
- Up to â‚ą5 Lakhs:
The Deputy Commissioner or Assistant Commissioner of Customs, who handles the concerned EOU, will adjudicate these notices. - Up to â‚ą50 Lakhs:
The Additional Commissioner or Joint Commissioner of Customs, having jurisdiction over the EOU, will handle these cases. - Above â‚ą50 Lakhs:
The Principal Commissioner or Commissioner of Customs will take charge of such high-value cases.
➡️ This tiered model ensures each case is reviewed by officers with suitable authority based on the scale of the demand.
đź“š Legal and Jurisdictional Background
Historically, customs officers overseeing EOUs also served as Central Excise Officers under Notification No. 38/2001-Central Excise (N.T.).
Over time, multiple notifications — including No. 52/2003-Customs and No. 79/2018-Customs — transferred adjudication powers from Central Excise to Customs officers for EOUs.
Now, CBIC uses its authority under Sections 4, 3, 5(1), and 5(1A) of the Customs Act, 1962 to standardize adjudication. This ensures that all show cause notices—especially those remanded for de novo adjudication—are assigned according to a uniform process.
đź“Ś What This Means for EOUs and the Export Sector
This move affects EOUs and their stakeholders in several important ways:
1. Improved Transparency
The structured assignment of cases helps companies clearly understand which authority will handle their disputes. This reduces confusion and bureaucratic delays.
2. Faster Resolution
Cases are now routed to the right level of officer from the start. This can significantly speed up decisions and minimize the backlog of pending adjudications.
3. Legal Certainty
By removing overlaps between customs and excise jurisdictions, the notification offers a more stable legal framework. EOUs now have a clearer roadmap when responding to notices.
4. Better Resource Allocation
Each adjudicating officer will now handle cases that match their level of responsibility. This prevents overburdening senior officials with minor disputes and promotes efficiency across departments.
5. Encouragement for Exporters
EOUs can focus more on operations and exports rather than lengthy legal uncertainty. This change could boost investor confidence, especially for businesses relying on export-driven models.
🔎 Why This Notification Matters Now
Over the years, the government has aimed to integrate customs and central excise duties into a more cohesive tax structure. However, legacy disputes—particularly those involving EOUs—still linger.
This notification directly addresses those legacy issues. It gives new life to old cases remanded for fresh adjudication and places them in the right hands.
At the same time, it acknowledges the evolution of India’s indirect tax system, especially in a post-GST era. The move aligns with CBIC’s broader goal of modernization and accountability.
đź“ť Conclusion
CBIC Notification No. 35/2025 – Customs (N.T.) marks a key administrative reform. By laying down clear, amount-based thresholds for assigning show cause notices, the government ensures clarity, speed, and legal efficiency in handling EOUs’ disputes.
Exporters, tax professionals, and compliance officers must stay updated and prepare for a quicker adjudication cycle. They should also evaluate current disputes to determine which officer now holds jurisdiction.
This reform is a step in the right direction for improving dispute resolution in India’s complex customs and excise framework.
