Union Budget: Customs litigation has become one of the most silent yet expensive drags on India’s trade system. Thousands of disputes on valuation, classification, exemptions, and now on origin of goods remain stuck in adjudication and appellate forums for years, sometimes decades. This unresolved litigation is not merely a number on paper; in reality, it represents capital frozen, with a snowballing impact on the economy. These disputes bring unpredictability and chaos for global supply chains already operating on razor-thin margins and strict timelines.

Despite this growing backlog, customs has remained outside India’s amnesty playbook. This is striking, especially when excise, service tax, VAT, and income tax disputes have all benefited from well-designed settlement schemes that brought closure and restored trust. India’s tax amnesty schemes have been well-intentioned and have helped reduce litigation, particularly under the erstwhile excise and service tax regimes. Past initiatives under the excise, service tax, and VAT frameworks demonstrated that when legacy disputes are decisively resolved, the benefits extend well beyond immediate revenue collection. They restore certainty, unlock working capital, and allow both taxpayers and the administration to redirect attention towards future compliance rather than past disagreements. Budget 2026 therefore presents a perfect policy moment to clear the backlog and rebuild investor confidence through a customs amnesty scheme, which is now widely anticipated.