Paradeep Phosphates Faces Customs Penalty Over Prilled Urea Importation
Paradeep Phosphates Limited has faced an adjudication order from the Office of the Commissioner of Customs, Goa, regarding the import and classification of seven consignments of Prilled Urea. The ruling resulted in significant fines and penalties against the company related to alleged mis-declaration of the imported goods.The proceedings stemmed from a Show Cause Notice dated December 5, 2025. The Adjudicating Authority determined that the imported urea did not qualify as Technical Grade Urea because its biuret content exceeded 0.80%, thus placing it under Fertilizer Grade Urea. Consequently, the goods were deemed prohibited and liable for confiscation under Sections 111(d) and 111(m) of the Customs Act, 1962.
The order imposed several financial penalties against Paradeep Phosphates Limited. The details are as follows:
| Financial Component | Amount |
|---|---|
| Redemption fine (Section 125(1)) | ₹23.26 crore |
| Penalty under Section 112(a)(i) | ₹46.52 crore |
| Penalty under Section 114AA | ₹23.81 crore |
| Total Fine and Penalties | ₹93.59 crore |
The assessable value of the goods covered by the order was reported at ₹465.23 crore. The company received this adjudication order on August 20, 2026.
Company Defenses and Operational Impact
Paradeep Phosphates Limited contested the findings, arguing that the principal basis for the allegation—the Biuret content of the imported Urea—was disputed. The company explained that consignments had been independently tested by surveyors at the load port, with test certificates generally reporting biuret content within the applicable limit for Technical Grade Urea.The company challenged the department's reliance on post-clearance factory test results, noting that these results were generated using an in-house rapid testing method and did not adhere to the sampling and testing procedure prescribed under IS 1781:2022. Furthermore, PPL submitted that Customs personnel did not draw representative samples while the goods were under customs control, and no contemporaneous Customs/CRCL test report was available.
While the adjudication order carries a substantial financial implication, management stated that it is not expected to have any material operational impact on the company's ongoing business operations. Paradeep Phosphates Limited affirmed its belief in full compliance with all applicable laws and regulations and indicated that it will pursue appropriate legal recourse against the adjudication order.
PARADEEP Stock Price Movement
Shares of Paradeep Phosphates Limited slipped by 0.26% to close on Friday at ₹148.48, shedding ₹0.39 from the previous day's closing price. The equity traded briskly throughout the session, with over 2.02 million shares changing hands.Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
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