CLASSIFICATION OF GOODS
3.1 Customs Tariff Act (CTA)
Once t he li a bili t y of pay me nt of c ust o ms d ut y i s est a bli s he d, t he ne xt q uesti o n i s what i s t he a mo unt of d ut y paya bl e. The t wo st e p pr ocess i s ( a ) Corr ectl y cl assi f y t he g oo ds, t o find o ut r at e of c ust o ms d ut y (b ) Fi nd i t s ass ess a bl e val ue t o whi c h t he r at e of d ut y i s t o be a ppli e d f or c al c ul ati ng a mo unt of d ut y paya bl e.
The r at e of d ut y i s f o und o ut by cl assi f yi ng t he pr o d uct i n i t s a ppr opri at e he a di ng under Cust o ms Tari ff.
The Cust o ms Tari ff Act cl assi fies all t he g oo ds under 97 c ha pt ers a nd s peci fic c o de i s assi g ne d t o e ac h i t e m . Ther e ar e over 1, 000 t ari ff he a di ngs a nd 2, 000 s ub- he a di ngs. Thi s cl assi fic ati o n f or ms basi s f or cl assi f yi ng t he g oo ds under parti c ul ar Cha pt er he a d a nd Sub- he a d t o pr es cri be c ust o ms d ut y t o be c har ge d o n t hat parti c ul ar pr o d uct.
Classification of a product is to be done by consignor only - Cl assi ficati o n of a pr o duct i s t o be do ne by c o nsi g nor o nl y Cl assi ficati o n ca nnot be c ha nge d or q uesti o ne d at c o nsi g nee ’ s e nd –Steel Authority of India Ltd. v. CCE ( 2022) 382 ELT 10 ( S C).
Classification is responsibility of supplier, purchaser is not obliged to indicate classificationCl assi ficati o n i s t he r es po nsi bili t y of s uppli er, p ur c has er i s not o bli ge d t o i ndi cat e cl assi ficati o n of g oo ds he i s p ur c hasi ng –UOI v. Bharat Forge ( 2022) 93 GS T 731 = 141 t ax ma nn. c o m 731 = 64 GS TL 3 ( S C).
Customs Tariff Act is used for GSTCust o ms Tari ff Act i s bei ng us e d f or cl assi fic ati o n of g oo ds f or p ur pos e of l e vy of GS T w . e. f. 1- 7- 2017. Ther e i s no s e par at e t ari ff f or p ur pos e of GS T .
Linking of Tariff Act and Main ActLi nki ng has bee n ma de i n Cust o ms, vide s ecti o n 2 of Cust o ms Tari ff Act a nd s ecti o n 12 of Cust o ms Act.
3.1-1 Background of the Tariff
As i nt er nati o nal t r a de i ncr e as e d, nee d was f el t t o have uni vers al st a ndar d s yst e m of cl assi fic ati o n of g oo ds t o f acili t at e t r a de flo w a nd a nal ysi s of t r a de st ati sti cs. He nce, Har mo ni s e d Co mmo di t y Des cri pti o n a nd Co di ng Syst e m ( Ge ner all y r ef err e d t o as ‘ Har mo ni s e d Syst e m ’ or si mpl y ‘ HS ’ ) was de vel ope d by Worl d Cust o ms Or ga ni s ati o n ( WC O) [ www . wc oo md. or g].
Thi s i s a n I nt er nati o nal No me ncl at ur e st a ndar d a dopt e d by a bo ut 200 Co unt ri es t o e ns ur e uni f or m i t y i n cl assi fic ati o n i n I nt er nati o nal Tr a de HS Ni s mul ti - p ur pos e i nt er nati o nal pr o d uct no me ncl at ur e de vel ope d by WC O( Worl d Cust o ms Or ga ni s ati o n). It c o mpri s es a bo ut 5, 000 c o mmo di t y gr o ups, e ac hi de nti fie d by
a si x di gi t c o de, arr a nge d i n a l e gal a nd l ogi c al st r uct ur e. The s yst e mi s us e d by mor e t ha n 200 c o unt ri es. Over 98 % of t he mer c ha ndi s e i n i nt er nati o nal t r a de i s cl assi fie d i n t er ms of HS - WC O we bsi t e - q uot e d i n Hitachi Home and Life Solutions v. CC ( 2012) 285 ELT 504 ( CES TAT), wher e i t was hel d t hat HS N a ut o mati c all y cl assi fies t he t r a de parl a nce t est.
Har mo ni s e d Syst e m ( HS) pr ovi des c o mmo di t y/ pr o duct c o des a nd des cri pti o n upt o 4- di gi t ( Hea di ng) a nd 6- di gi t ( Sub- Hea di ng) l evel s o nl y a nd me mber c o unt ri es of WC O ar e all o we d t o ext e nd t he c o des upt o a ny l evel s ubj ect t o t he c o ndi ti o n t hat not hi ng c ha nges at t he 4- di gi t or 6- di gi t l evel s. I ndi a has devel ope d 8- di gi t l evel cl assi fi cati o n t o i ndi cat e s peci fi c st ati sti cal c o des f or i ndi ge no us pr o duct s a nd al s o t o mo ni t or t he t r a de v ol u mes
– Chapter 5 Para 2.2 of CBIC’s Customs Manual, 2025. HS i s a me nde d peri o di call y i n a cycl e of 4/6 years, t a ki ng not e of t he t r a de fl o w , t ec hnol ogi cal pr ogr ess et c. Me mber c o unt ri es i ncl udi ng I ndi a ar e under o bli gati o n t o a me nd t he Tari ff Sc he dul es i n ali g n me nt w i t h HS – Chapter 5 Para 2.3 of CBIC’s Customs Manual, 2025
For p ur pos e of uni f or mi nt er pr et ati o n of HS , t he WC O has p ubli s he d det ail e d Ex pl a na - t or y Not es t o vari o us hea di ngs /s ub- hea di ngs. WC Oi n i t s vari o us c o mm i tt ees di s c uss es cl assi fi cati o n of i ndi vi dual pr o duct s a nd gi ves cl assi fi cati o n opi ni o n o n t he m . Suc h i nf or mati o n, t ho ug h not bi ndi ng i n nat ur e, pr ovi des a us ef ul g ui deli ne f or cl assi f yi ng g oo ds – Chapter 5 Para 2.4 of CBIC’s Customs Manual, 2025.
Cust o ms Tari ff us es 8 di gi t no me ncl at ur e. I T C ( HS) p ubli s he d by DGF T has 10 di gi t cl assi fi cati o n.
Per m i ssi bili t y of i mport a nd ex port i s g over ne d by t he DGF T ’ s I T C( HS) [ I mport Tr a de Co nt r ol ( Har mo ni s e d Syst e m)] cl assi fi cati o n of i mport a nd ex port g oo ds, p ubli s he d by DGF T . The no me ncl at ur e arr a nges g oo ds as i n t he HS t o r eg ul at e For ei g n Tr a de Poli cy a nd c oll ati ng t he st ati sti cal a nal ysi s of i mport s a nd ex port s of t he c o unt r y– Chapter 5
Para 2.13 of CBIC’s Customs Manual, 2025.
Cas e l a w i n r es pect of r el e va nce of HS N i n cl assi fic ati o n of a pr o d uct i s di s c uss e d i n ne xt c ha pt er.
3.1-2 Tariff contains schedules
Cust o ms Tari ff Act has t wo Sc he dul es - fi rst s c he dul e i s i n r es pect of I mport Tari ff, whi c h we have di s c uss e d a bove. Sec o nd Sc he dul e i s ‘ Ex port Tari ff’, s ho w i ng ex port du - ti es l evi a bl e Si nce most of ex port s ar e exe mpt f r o mex port dut y, t he s c he dul e c o nt ai ns o nl y 50 i t e ms ( as o n 1- 1- 2022), o ut of whi c h ma ny ar e exe mpt by way of a noti fi cati o n No. 27/2011- Cus dat e d 1- 3- 2011 as a me nde d.
3.1-3 Sections, Chapters and headings in Tariff
Ther e ar e 21 s ecti o ns i n c as e of Cust o ms Tari ff.
Methodology of classification of goods - I n t he Tari ff Sc he dul e, c o mmo di ti es / pr o duct s ar e arr a nge d i n a fixe d patt er n w i t h t he dut y r at es s peci fie d agai nst eac h of t he m . The patt er n of arr a nge me nt of g oo ds i n t he Tari ff i s i n i ncr easi ng degr ee of ma nuf act ur e of c o mmo di ti es / pr o duct s i n t he s e q ue nce of nat ur al pr o duct s, r a w mat eri al s; s e m i fini s he d g oo ds a nd f ull y fini s he d g oo ds /arti cl e/ mac hi ner y, et c. The I ndi a n Cust o ms Tari ff has 21 Secti o ns a nd 98 Cha pt ers. Secti o n i s a gr o up c o nsi sti ng of a nu mber of Cha pt ers whi c h c o di f y a parti c ul ar cl ass of g oo ds The Secti o n not es ex pl ai n t he s c ope of c ha pt ers / hea di ngs, et c. The Cha pt ers c o nsi st of c ha pt er not es, bri ef des cri pti o n of c o mmo di ti es arr a nge d at f o ur di gi t, si x di gi t a nd ei g ht di gi t l evel s. Ever y f o ur- x di gi t c o de i s call e d “ hea di ng” a nd ever y si x di gi t c o de i s call e d a “ s ub- hea di ng” a nd 8 di gi t c o de i s call e d a “ Tari ff It e m”Chapter 5 Para 2.1 of CBI&C’s Customs Manual, 2025.
Sections in Customs Tariff - A ‘ s ecti o n ’ i s a gr o upi ng of a nu mber of Cha pt ers whi c h c o di f y a parti c ul ar cl ass of g oo ds Eac h of t he s ecti o ns i s r el at e d t o a br oa der cl ass of g oo ds e. g. Secti o n I i s ‘ Ani mal Pr o duct s ’ , Secti o n VII i s ‘ Pl asti cs a nd Arti cl es t her e of’, Secti o n XI i s ‘ Textil e a nd Textil e Arti cl es ’ , Secti o n XVII i s ‘ Ve hi cl es, Ai r cr aft s, Vess el s a nd ass oci at e d t r a ns port e q ui p me nt’, et c Secti o n Not es ar e gi ve n at t he begi nni ng of eac h Secti o n, whi c h g over n e nt ri es i n t hat Secti o n. Thes e not es ar e a ppli ca bl e t o all Cha pt ers i n t hat s ecti o n.
Section divided in Chapters and chapters in sub-chapters - Eac h of t he s ecti o ns i s di vi de d i nt o vari o us Cha pt ers a nd e ac h Cha pt er c o nt ai ns g oo ds of o ne cl ass. For e xa mpl e, Secti o n XI r el at es t o Te xtil e a nd Te xtil e Arti cl es a nd w i t hi n t hat Secti o n, Cha pt er 50 i s Sil k, Cha pt er 51 i s Wool, Cha pt er 52 i s Cott o n, Cha pt er 53 i s ot her ve get a bl e t e xtil e f a bri cs, Cha pt er 61 i s Arti cl es of Appar el a nd s o o n.
Ther e ar e 98 c ha pt ers o ut of whi c h Cha pt er 77 i s bl a nk, whi c h i s ke pt r es er ve d f or f ut ur e us e
So me Cha pt ers ar e di vi de d i nt o s ub- c ha pt ers e g Cha pt er 72 ( I r o n a nd St eel ) i s di - vi de d i nt o I - Pri mar y Mat eri al s, II - I r o n a nd No n- All oy St eel, III - St ai nl ess St eel a nd I V - Ot her All oy St eel.
Chapter Notes - Cha pt er Not es ar e gi ve n at t he be gi nni ng of e ac h Cha pt er, whi c h g over n e nt ri es i n t hat Cha pt er.
Headings and sub-headings within the ChapterEac h c ha pt er a nd s ub- c ha pt er i s f ur - t her di vi de d i nt o vari o us he a di ngs de pe ndi ng o n di ff er e nt t y pes of g oo ds bel o ngi ng t o s a me cl ass of pr o d uct s.
For i nst a nce, Cha pt er 50 r el ati ng t o Sil k i s f urt her di vi de d i nt o 5 he a di ngs 5001 r e - l at es t o Sil k wor m c oc oo ns, 5002 r el at es t o r a w sil k, 50. 03 r el at es t o sil k wast e et c. The he a di ngs ar e s o meti mes di vi de d i nt o f urt her s ub- he a di ngs. For e xa mpl e 5003 10 me a ns ‘ sil k wast e not c ar de d or c o mbe d’, whil e 5003 90 me a ns ‘ ot her sil k wast e ’ . Thes e ar e pr ece de d by si ngl e das h. 5003 90 i s f urt her cl assi fie d as 5003 90 10 ( Mul berr y sil k wast e), 5003 90 20 ( Tuss ar wast e) a nd 5003 90 90 ( Ot her).
Grouping of goods – I n t he Tari ff Sc he dul e, c o mmo di ti es / pr o duct s ar e arr a nge d i n a fixe d patt er n w i t h t he dut y r at es s peci fie d agai nst eac h of t he m The patt er n of arr a ngeme nt of g oo ds i n t he Tari ff i s i n i ncr easi ng degr ee of ma nuf act ur e of c o mmo di ti es / pr o duct s i n t he s e q ue nce of nat ur al pr o duct s, r a w mat eri al s, s e m i fini s he d g oo ds a nd f ull y ma nuf act ur e d g oo ds /arti cl e/ mac hi ner y et c.Chapter 5 Para 2.1 of CBI&C’s
Customs Manual, 2025.
I n Moneeto Plasti-Fab P Ltd. v. CCE 2006 ( 199) ELT 163 ( CES TAT), i t was hel d t hat Tari ff bas e d o n HS N e n u mer at es arti cl es i n or der of pr ogr essi o n of ma n uf act uri ng pr ocess, a pr o d uct ari si ng o ut of f urt her ma n uf act uri ng ge ner all y get s li st e d under a l at er he a di ng.
Eight Digit classification
- All g oo ds ar e cl assi fie d usi ng 4 di gi t s yst e m Thes e ar e c all e d ‘ he a di ngs ’ . Furt her 2 di gi t s ar e a dde d f or s ub- cl assi fic ati o n, whi c h ar e t er me d as ‘ s ub- he a di ngs ’ . Furt her 2 di gi t s ar e a dde d f or s ub- s ub- cl assi fic ati o n, whi c h i s t er me d as ‘ t ari ff i t e m ’ . Rat e of d ut y i s i ndi c at e d agai nst e ac h ‘ t ari ff i t e m ’ a nd not agai nst he a di ng or s ub- he a di ng.
The s a me cl assi fic ati o n will be us e d by DGF T ( Di r ect or Ge ner al of For ei g n Tr a de) a nd DGCI S ( Di r ect or Ge ner al of Co mmer ci al I nt elli ge nce & St ati sti cs). The a ddi ti o nal 2 di gi t s ar e t o f acili t at e a nd pr ovi de fle xi bili t y i n i nt er nati o nal t r a de. The c o mmo n cl as - si fic ati o n will r e d uce t r a ns acti o n c ost s a nd r e d uce di versi o n of cl assi fic ati o n a mo ng di ff er e nt age nci es.
3.1-4 Coding of dashes
Si ngl e das h (-) at t he be gi nni ng of des cri pti o n of a ny arti cl e i n Tari ff i ndi c at es a gr o up, whil e t wo das hes (- -) at t he be gi nni ng i ndi c at e a s ub- gr o up. The si ngl e das h (-) i ndi c at es pri mar y cl assi fic ati o n of arti cl e c over e d by t he he a di ng, whil e do ubl e das h (- -) i s t he s ub- cl assi fic ati o n of t he pr ece di ng arti cl e whi c h has si ngl e das h (-) i e i t i s a s ub- cl assi fic ati o n of pri mar y cl assi fic ati o n.
Tri pl e das h (- - -) a nd q ua dr upl e das h (- - - -) i ndi c at e s ub- s ub- cl assi fic ati o n of i mme - di at el y pr ece di ng des cri pti o n of arti cl e, whi c h has ‘‘ or ‘ -‘ . I n ot her wor ds, a si ngl e das h or do ubl e das h may be f oll o we d by ei t her t hr ee das hes or f o ur das hes Bot h t hr ee das hes or f o ur das hes ar e us e d t o i ndi c at e 8 di gi t cl assi fic ati o n i. e. ‘ t ari ff i t e m ’ .
Goo ds t o f all i n t ari ff e nt r y w i t h do ubl e das h (- -) have t o s ati sf y s peci fic ati o n of si ngl e das h(-) pr ece di ng t he m-
Schenectady Herdillia Ltd . v. CCE ( 2007) 208 ELT 110 ( CES TAT).
Foll o w i ng hypothetical e xa mpl e ill ust r ati ng cl assi fic ati o n of ‘ Re a dy Ma de Gar me nt s ’ will ma ke t he di sti ncti o n cl e ar [ Not e t hat t hi s i s not act ual e xt r act f r o mt he t ari ff]
A Ready Made Garments
AAMe n ’ s we ar
AA- 1
Sui t s
AA- 2 -Shi rt s
AA- 3 -Ot her
A BLa di es we ar
A B- 1
A B- 2
A B- 3
Sal war
Ski rt s
Ot her
ACOt her
The ‘ r e a dy ma de gar me nt s ’ ar e cl assi fie d as ( a) Me n ’ s we ar ( b) La di es we ar ( c) Ot her
The me n ’ s we ar a nd l a di es we ar ar e f urt her s ub- cl assi fie d. Th us, ‘ Ot her’ i n AA- 3 me a ns me n ’ s we ar ot her t ha n s ui t s a nd s hi rt s, whil e ‘ ot her’ i n AC me a ns all r e a dy ma de garme nt s e xcl udi ng Me n ’ s we ar a nd La di es we ar
Rul e 6 of I nt er pr et ati o n Rul es of Sc he d ul e t o Tari ff st at e t hat Cl assi fic ati o n of g oo ds i n s ub- he a di ngs s hall be det er m i ne d i n t er ms of t hos e s ub- he a di ngs. Onl y s ub- he a di ngs at t he s a me l e vel ar e c o mpar a bl e e. g. i n af or es ai d e xa mpl e, A B- 1 a nd A B- 3 c a n be c o mpar e d, b ut A B- 3 c a nnot be c o mpar e d w i t h ( s ay) AA- 3
3.1-5 Searching HSN Code on CBI&C website
Sear c h f acili t y i s avail a bl e o n we bsi t e. The s ear c h ca n be o n basi s of t ec hni cal des cri p - ti o n as well as des cri pti o n t hr o ug h t r a de or c o mmer ci al des cri pti o n. It i s avail a bl e at pr e-l ogi n a nd post-l ogi n. Go t o Ho me > Ser vi ces > Us er Ser vi ces > Sear c h HS N Co de.
The s ear c hi s bas e d o n Arti fi ci al I nt elli ge nce a nd Mac hi ne l a ng uage li nke d w i t h e-i nv oi ce decl ar ati o n dat a bas e – htt ps: // www . gst. g ov. i n dat e d 6- 1- 2022.
3.1-6 Import Policy aligned with Customs Tariff and HSN
I mport Poli cy has bee n s peci fi e d i t e m - w i s e, t er me d as I T C ( HS) 2022 [ I mport Tr a de Cl assi fi cati o n ( Har mo ni s e d Syst e m ) of I mport It e ms, 2022].
The I TC( HS) 2022i s ali g ne d w i t h Cust o ms Tari ff, whi c h has bee n a me nde d w . e. f. 1- 1- 2022.
I T C( HS) 2022 has bee n noti fi e d vi de DGF T Noti fi cati o n No. 54/2015- 20 dat e d 9- 2- 2022.
Up dat e d I T C ( HS) 2022 i s avail a bl e o n we bsi t e of DGS T ( htt ps: // dgft. g ov. i n).
3.2 Overview of Customs Tariff
Foll o w i ng i s br oa d gr o upi ng of g oo ds i n Tari ff:
Ani mal Pr o d uct s ( Secti o n I - Cha pt ers 1 t o 6)
Ve get a bl e Pr o d uct s ( Secti o n II - Cha pt ers 6 t o 14)
Ani mal or ve get a bl e f at s a nd oil s ( Secti o n III - Cha pt er 15)
Pr e par e d f oo dst uff s, be ver ages ( Secti o n I V - Cha pt ers 16 t o 24)
M i ner al Pr o d uct s ( Secti o n V - Cha pt ers 25 t o 27)
Pr o d uct s of Che m i c al s a nd alli e d i nd ust ri es ( Secti o n VI - Cha pt ers 28 t o 38)
Pl asti cs a nd Rubber a nd t hei r arti cl es ( Secti o n VII - Cha pt ers 39 a nd 40)
Ra w hi des a nd Ski ns, Le at her a nd arti cl es ( Secti o n VIII - Cha pt ers 41 t o 43)
Woo d, c or k, st r a w a nd t hei r arti cl es ( Secti o n I X - Cha pt ers 44 a nd 46)
Pul p of woo d, Pa per, Pa per- boar d a nd arti cl es ( Secti o n X - Cha pt ers 47 t o 49)
Te xtil e a nd Te xtil e Pr o d uct s ( Secti o n XI - Cha pt ers 50 t o 63)
Foot we ar, He a dge ar, U mbr ell as, Arti cl es of h u ma n hai r ( Secti o n XII - Cha pt ers 64 t o 67)
Arti cl es of st o ne, pl ast er, cer a m i c, m i c a, gl ass ( Secti o n XIII - Cha pt ers 68 t o 70)
Pe arl s, pr eci o us met al s ( Secti o n XI V - Cha pt er 71)
Bas e met al s a nd arti cl es of bas e met al ( I r o n, St eel, Copper, Ni c kel, Zi nc, Ti n et c. ). ( Secti o n XV - Cha pt ers 72 t o 83)
Mac hi ner y a nd mec ha ni c al a ppli a nces, el ect ri c al e q ui p me nt s, t el e vi si o n et c. ( Secti o n XVI - Cha pt ers 84 a nd 85)
Ve hi cl es, Ai r cr aft s, vess el s a nd ass oci at e d t r a ns port e q ui p me nt ( Secti o n XVII - Cha pt ers 86 t o 89)
Opti cal, phot ogr aphi c, me di cal, s ur gi cal i nst r u me nt s, cl oc ks, musi cal i nst r u me nt s ( Secti o n XVIII - Cha pt ers 90 t o 92)
Ar ms a nd A mmuni ti o n ( Secti o n XI X - Cha pt er 93)
M i s c Ma n uf act ur e d arti cl es li ke Fur ni t ur e, t oys et c ( Secti o n XX - Cha pt ers 94 t o 96)
Wor ks of Art, c oll ect ors ’ pi eces a nd a nti q ues ( Secti o n XXI - Cha pt ers 97 t o 99)
Special provisions in Customs Tariff - Tho ug h most of g oo ds ar e cl assi fie d as per a bove s yst e m , s peci al cl assi fic ati o n i s us e d i n cert ai n c as es* All g oo ds i mport e d under ‘ pr oj ect i mport s ’ - 98. 01 * All l a bor at or y c he m i c al s i n pac ks l ess t ha n 500 g ms or 500 m l - 98. 02 * All baggage of pass e ngers or me mber of cr e w- 98. 03 * Goo ds f or pers o nal us e i mport e d by post or ai r - 98 04 * St or es o n boar d of vess el or ai r cr aft - 98 05 Th us, t hos e g oo ds will be cl assi fie d i n t hes e he a di ngs, i rr es pecti ve of act ual cl assi fic ati o n as per t he Cust o ms Tari ff.
Columns in CTAI n Cust o ms Tari ff, t her e ar e five c ol u mns - ( 1) Tari ff It e m( 2) Des cri p - ti o n of g oo ds ( 3) Uni t ( 4) St a ndar d Rat e of Dut y ( 5) Rat e of d ut y f or Pr ef er e nti al Ar e a
Gover n me nt c har ges l o wer c ust o ms d ut y i n c as e of i mport of s o me s peci fie d g oo ds f r o m Mya n mar, Ba ngl a des h, Ma uri ti us, Se yc hell es, Ne pal, To nga et c. I f pr ef er e nti al r at e i s not s peci fie d f or a parti c ul ar pr o d uct, t he st a ndar d r at e of c ust o ms d ut y will a ppl y.
Preferential Area RatesCust o ms Tari ff has e xt r a c ol u mn gi vi ng Rat e of d ut y f or
Pr ef er e nti al ar e a. I f no r at e i s me nti o ne d i n t he c ol u mn ‘ Rat e f or Pr ef er e nti al Ar e a ’ , t he n St a ndar d r at e i s a ppli c a bl e.
Rul es have bee n f r a me d t o det er m i ne ori gi n of pr o d uct s
Power to Central Government to amend schedule of Customs Tariff - Secti o n 11 A of
Cust o ms Tari ff Act e mpo wers Ce nt r al Gover n me nt t o a me nd t he Fi rst Sc he d ul e t o
Cust o ms Tari ff, by i ss ue of a noti fic ati o n. Suc h a me nd me nt s hall not al t er t he r at e of d ut y of c ust o ms l e vi a bl e o n s uc h g oo ds.
Suc h a me nd me nt may bec o me necess ar y t o ali g n t he c ust o ms t ari ff w i t h HS N or ma ke s o me c orr ecti o ns whi c h will not aff ect t he r at e of c ust o ms d ut y.
3.2-1 Standard unit of quantity
Thi r d c ol u mn of t ari ff i s ‘ Uni t’ whi c h i s uni t of me as ur e The uni t of me as ur e i s i ndic at e d by a bbr e vi ati o ns So me a bbr e vi ati o ns ar e as f oll o ws - cc - Cubi c Ce nti met r e, c m- Ce nti met er( s), g - gr a m ( s), g/c m 3 - Gr a m per c ubi c ce nti met er, l - li t r e, m- met r e, mt - Met ri c To nne, t - To nne, Tu - Tho us a nd i n n u mber, u - Nu mber, Vol - Vol u me, W - Watt
Standard unit compulsory in case of customs, but can be waived - The st a ndar d uni t of q ua nti t y i s s peci fie d f or e ac h t ari ff i t e mt o f acili t at e t he c oll ecti o n, c o mpari s o n a nd a nal ysi s of t r a de st ati sti cs [ Addi ti o nal Not e No. 3 t o CETA a nd i n Cust o ms Tari ff Act]. Thes e s ho ul d be us e d i n c ust o ms doc u me nt s - C BI &C l ett er F . VAL/217/2001 dat e d 9- 11- 2005 - 193 ELT T4 [ I n ma ny c as es, t hes e st a ndar d uni t s ar e not us e d by t r a de. I n s o me c as es, t hes e ar e i mpr acti c al e. g. l ubri c ati ng oil i n Kgs not li t ers, Adhesi ve t a pe a nd pl asti c arti cl es i n Kgs not Nos. Eve n f ur ni t ur e a nd t oys ar e t o be i ndi c at e d i n Kgs a nd not Nu mbers! ].
I ndee d t hi s di f fic ul t y has bee n noti ce d a nd i t has bee n cl ari fie d t hat wher e st at ut or y UQC ( Uni t Qua nti t y Co de) i s at c o mpl et e vari a nce w i t h est a bli s he d st a ndar d t r a de pr acti ces a nd i s unr e as o na bl e /ill ogi c al t o i mpl e me nt, r e q ui r e me nt of UQC c a n be wai ve d by Gr o up AC/ DC (i n c as e of no n- R MS bill s of e nt r y a nd AC/ DC ( doc ks) i n c as e of R MS f acili t at e d Bill s of Ent r y - CC ( I mport s), J NC H , Nhava She va P N 37/2013 dat e d Nove mber, 2013 [ 298 ELT T35].
3.3 Rules for Interpretation of Tariff
Rul es f or I nt er pr et ati o n of Sc he d ul e t o Tari ff ar e gi ve n i n t he Tari ff i t s el f. Thes e ar e t er me d as ‘ Ge ner al I nt er pr et ati ve Rul es ’ ( GI R)
Abbr e vi ati o n ‘ % ’ i n Col u mn 4 i ndi c at es t hat d ut y i s c har ge d ‘ a d val or e m ’ o n t he val ue of g oo ds as c al c ul at e d i n s ecti o n 12 of Cust o ms Act
I n CCE v. Wood Polymers Ltd. 1998 AI R S C W 372 = 1998 ( 97) ELT 193 ( S C), i t was hel d t hat cl assi fic ati o n s ho ul d be do ne as per r ul e of i nt er pr et ati o n c o nt ai ne d i n t he t ari ff a nd not as per t r a de parl a nce a nd c o mmer ci al underst a ndi ng. [ Thi s i s s o i f r ul es of i nt er pr et ati o n gi ve c orr ect a nd c o ncl usi ve a ns wer. Ot her w i s e, o ne has t o l ook t o t r a de parl a nce].
I n O K Play (India) v. CCE 2005 ( 180) ELT 300 ( S C 3 me mber be nc h), i t was hel d as f oll o ws(1) No o ne si ngl e uni vers al t est c a n be a ppli e d f or c orr ect cl assi fic ati o n. Ther e c a nnot be st ati c par a met er f or c orr ect cl assi fic ati o n (2) HS N al o ng w i t h e x pl a nat or y not es pr ovi de a s af e g ui de f or i nt er pr et ati o n of e nt r y(3) Eq ual i mport a nce i s r e q ui r e d
t o be gi ve n t o Rul es of I nt er pr et ati o n of Tari ff (4)
Functi o nal utili t y, desi g n, s ha pe a nd pr e do m i na nt us age have al s o g ot t o be t a ke n i nt o acc o unt whil e det er m i ni ng cl assi - fic ati o n of a n i t e m (5) The af or es ai d ai ds ar e mor e i mport a nt t ha n t he na mes us e d i n t r a de or c o mmo n parl a nce i n t he matt er of c orr ect cl assi fic ati o n - q uot e d w i t h a ppr oval i n
DCL Polyester v. CCE 2005 ( 181) ELT 190 ( S C).
Rules if classification as per tariff and chapter/section notes not possible - Rul e 1 of Rul es f or i nt er pr et ati o n of t he Sc he d ul e st at es t hat cl assi fic ati o n s hall be det er m i ne d acc or di ng t o t he t er ms of t he he a di ngs a nd a ny r el ati ve s ecti o n or c ha pt er not es a nd, pr ovi de d s uc h he a di ngs or Not es do not ot her w i s e r e q ui r e, acc or di ng t o ot her pr o - vi si o ns of t he r ul es. It has bee n hel d t hat t hes e r ul es ar e r e q ui r e d t o be a ppli e d o nl y i f cl assi fic ati o n i s not possi bl e o n basi s of t ari ff e nt r y r e a d w i t h Cha pt er not es a nd s ecti o n not es. *
Track Parts Corporation v. CC - 1992 ( 57) ELT 98 ( CE GAT) * L M Van
Moppes Diamond Tools India Ltd. v. CC 1986 ( 24) ELT 623 ( CE GAT) *
Hindustan Gas v. CC 1990( 49) ELT 548 ( CE GAT) * Netlon India v. CCE 2000( 121) ELT 675 ( CE GAT).
Rul e 1 gi ves pri mac y t o t he s ecti o n a nd c ha pt er not es al o ng w i t h t er ms of t he he a di ngs. The y s ho ul d be first a ppli e d. I f no cl e ar pi ct ur e e mer ges, t he n o nl y o ne c a n r es ort t o s ubs e q ue nt r ul esCCE v. Simplex Mills Co. Ltd. 2005 ( 181) ELT 345 = 140 S T C 125 ( S C 3 me mber be nc h) * Salora International Ltd. v. CCE ( 2012) 9 S CC 662 = 284 ELT 3 ( S C).
Cha pt er not e pr e vail s over he a di ng of c ha pt erMonita Containers v CCE ( 2007) 213 ELT 262 ( CES TAT)
I n International Auto Suppliers v. CC, Bombay - 1994 ( 70) ELT 645 ( CE GAT - 3 me mber be nc h or der), i t has bee n hel d t hat whe n a ppr opri at e he a di ng i s avail a bl e i n t ari ff, q ues - ti o n of r ef erri ng t o i nt er pr et ati ve r ul es does not ari s e. - s a me vi e wi n CCE v. Crescent Metal 1999( 111) ELT 841 ( CE GAT) * CCE v. HPL Chemicals 2001( 127) ELT 69 ( CE GAT) * Bharat Bijlee Ltd. v. CCE ( 2014) 309 ELT 129 ( CES TAT).
Classification of coconut oil packed in small bottles, whether edible oil or hair oil –Coc o - nut Oil pac ke d i n s mall q ua nti ti es s hall be ‘ e di bl e oil’ cl assi fia bl e under hea di ng 1513. Ho wever, i f t he pac ki ng s ati s fies all r e q ui r e me nt s s et up i n Cha pt er Not e 3 i n s ecti o n VI- Cha pt er 33 of Cust o ms Tari ff, i t will be cl assi fia bl e as hai r oil –CCE v. Madhan Agro Industries ( 2024) 25 Ce nt ax 269 = 391 ELT 145 ( S C 3 me mber be nc h)
3.3-1 Relevance of rules in interpretation of other rules, notifications
Me a ni ng of wor d us e d i n e xe mpti o n noti fic ati o n has t o be gat her e d f r o m t ari ff des cri pti o nSteel Authority of India Ltd. v. CCE 1997( 91) ELT 529 ( S C). Cha pt er not es of c ha pt er of Tari ff r ef err e d t o i n t he noti fic ati o n have t o be r e a d as part a nd par cel of e xe mpti o n noti fic ati o nGujarat State Fertilizers Co. v. CCE 91 ELT 3 = AI R 1997 S C 3620 = 1997 AI R S C W 1578 ( Thi s i s t he r ati o of j udg me nt, as c orr ectl y f o und by he a d not e wri t er of ELT , t ho ug h t hes e act ual wor ds ar e not us e d).
I n Sangameshwar Coffee Estates v. CC 1997( 96) ELT 119 ( CE GAT), i t was o bs er ve d‘ It i s s ettl e d l a w t hat f or i nt er pr et ati o n of noti fic ati o n, t he me a ni ng assi g ne d t o vari o us i t e ms i n a noti fic ati o n has t o be t he s a me as assi g ne d i n t he t ari ff.’ - s a me vi e w i n
Kirloskar Brothers v. CCE 2001( 133) ELT 595 ( CE GAT).
I n CC v. Maestro Motors Ltd. 2004 AI R S C W 7439 = AI R 2005 S C 1492 = 174 ELT 289 ( S C), i t was hel d t hat i f a t ari ff he a di ng i s s peci fic all y me nti o ne d i n e xe mpti o n noti fic ati o n, t he Ge ner al I nt er pr et ati ve Rul es ( GI R) will a ppl y t o s uc h e xe mpti o n noti fic ati o n. Ho we ver, i f a n i t e mi s s peci fic all y me nti o ne d w i t ho ut a ny t ari ff he a di ng, t he n e xe mpti o n wo ul d be avail a bl e e ve n t ho ug h f or p ur pos e of cl assi fic ati o n, i t may be s o met hi ng el s e. I n t hi s c as e, t her e wer e t wo s e par at e e xe mpti o n noti fic ati o ns. I n o ne c as e, t he noti fic ati o n was f or e xe mpti o n t o all c o mpo ne nt s of c ar br o ug ht i n C KD or S KD c o ndi ti o n. I mport er ha d i mport e d S KD pac ks whi c h wer e cl assi fia bl e as ‘ c ar ’
i n t er ms of s ec o nd part of GI R r ul e 2( a). Ho we ver, i t was hel d t hat t he e xe mpti o n will be avail a bl e e ve n i f f or p ur pos e of cl assi fic ati o n, t he g oo ds may be cl assi fia bl e as c ar as per r ul e 2( a) I n c as e of ot her e xe mpti o n noti fic ati o n, t he noti fic ati o n s peci fie d s pe - ci fic c o mpo ne nt s w i t h s peci fie d t ari ff he a di ngs. I n t hi s c as e al s o, t he i mport e d g oo ds wer e S KD pac ks a nd wer e cl assi fia bl e as ‘ c ar ’ i n t er ms of r ul e 2( a). It was hel d t hat si nce t he e xe mpti o n noti fic ati o n me nti o ns s peci fic t ari ff he a di ng, e xe mpti o n will not be avail a bl e i f t he g oo ds i mport e d ar e cl assi fia bl e as ‘ c ar ’ i n t er ms of GI R r ul e 2( a). Whe n wor di ng i n t ari ff e nt r y a nd e xe mpti o n noti fic ati o n i ss ue d i s si mil ar, arti cl e c over e d under t he t ari ff he a di ng i s c over e d under t he noti fic ati o n al s oEagle Flask
Industries (P.) Ltd. v CCE - 1991 ( 53) ELT 65 ( CE GAT) * Western Refrigeration (P.) Ltd. v. CC 1995 ( 77) ELT 673 ( CE GAT). Whe n a noti fic ati o n gr a nt s e xe mpti o n w i t h r ef er e nce t o a parti c ul ar he a di ng or s ub- he a di ng, t he noti fic ati o n will have t o be i nt er pr et e d a nd a ppli e d i n t he li g ht of s ecti o n not es a nd c ha pt er not es t o Tari ff.CCE v. Bharat Metal Industries 1999( 105) ELT 494 ( CE GAT) * Winter Misra Diamond v. CCE 1996( 83) ELT 670 = 64 EC R 60 ( CE GAT).
Ho we ver, t he e xe mpti o n noti fic ati o n c a nnot det er m i ne cl assi fic ati o n a nd i t c a nnot c ha nge cl assi fic ati o n of g oo ds f r o m o ne e nt r y t o a not herEskeyef v CCE - 1990 ( 49) ELT 649 ( S C).
Cha pt er not es a nd s ecti o n not es c a nnot be a ppli e d t oi nt er pr et a n e xe mpti o n noti fic ati o n i f t he des cri pti o n i n t he t ari ff a nd e xe mpti o n noti fic ati o n i s di ff er e ntPravinchandra
D Bros v CC - 1996 ( 88) ELT 151 ( CE GAT)
Secti o n not e ar e r el e va nt f or cl assi fic ati o n a nd e xe mpti o n b ut i f l a ng uage of noti fic a - ti o n i s cl e ar, s ecti o n not es c a nnot r est ri ct t hei r a mbi tNew Holland Tractors v. CCE ( 2010) 253 ELT 249 ( CES TAT).
I n CCE v. Mewar Bartan Nirman ( 2008) 231 ELT 27 ( S C), i t was hel d t hat e xe mpti o n noti fic ati o n s ho ul d be i nt er pr et e d i n t er ms of i t s l a ng uage. Whe n t he l a ng uage i s pl ai n a nd cl e ar, eff ect must be gi ve n t o i t. Whil e i nt er pr eti ng t he e xe mpti o n noti fic ati o n, o ne c a nnot g o by r ul es of i nt er pr et ati o n a ppli c a bl e i n c as es of cl assi fic ati o n under t he Tari ff [ I n t hi s c as e, s a me t ari ff e nt r y was s pli t i nt o t wo o nl y f or p ur pos e of e xe mpti o n noti fic ati o n. He nce, t he deci si o n has t o be vi e we d f r o mf act s of t he c as e].
I f e xe mpti o n noti fic ati o n i s r el at e d t o Tari ff ( e x pli ci tl y or by necess ar y i mpli c ati o n), t he c ha pt er not es /s ecti o n not es a nd r ul es of i nt er pr et ati o n c o mes i nt o pi ct ur e. I f i t i s not r el at e d t o t ari ff, noti fic ati o n has t o be i nt er pr et e d i nde pe nde ntl y a nd o n i t s o wn meri t.Adarsh Ice v. CCE
1999( 111) ELT 60 ( CE GAT). I f e xe mpti o n noti fic ati o n does not us e HS N no me ncl at ur e b ut us es na mes as avail a bl e i n I ndi a, HS N c a nnot be r eli e d upo n -
Bhilwara Spinners v CCE 1999( 111) ELT 714 ( CE GAT) - - I n Reflect Optics v CC 1997( 91) ELT 637 ( CE GAT), i t was hel d t hat s ecti o n not es a nd c ha pt er not es a nd r ul es of i nt er pr et ati o n of t ari ff c a n be a ppli e d f or i nt er pr eti ng noti fic ati o n o nl y i f des cri pti o n of g oo ds i n t he Cha pt er he a di ng has bee n e xt r act e d i n t he noti fic ati o n Whe n a noti fic ati o n gr a nt s e xe mpti o n t o g oo ds w i t h r ef er e nce t o a parti c ul ar he a di ng or s ub- he a di ng, t he noti fic ati o n will have t o be i nt er pr et e d i n li g ht of s ecti o n not es a nd c ha pt er not es a nd not acc or di ng t o t r a de pr acti ce or c o mmo n parl a nce.CCE v.
Bharat Metal Industries
1999( 105) ELT 494 ( CE GAT)
Not to be used for interpreting import policy - Rul e of I nt er pr et ati o n c a nnot be us e d t o i nt er pr et pr ovi si o ns of i mport poli c y.S S Appliances v. CCE 1998( 100) ELT 429 ( CE GAT) * Chan Tronix v. CC 2000( 124) ELT 510 ( CE GAT).
3.3-2 Steps in classification of a product
Foll o w i ng ar e t he st e ps of cl assi fic ati o n of a pr o d uct
( 1) The ti tl es of Secti o ns a nd Cha pt ers ar e pr ovi de d f or e as e of r ef er e nce o nl y; f or l e gal p ur pos es, r ef er t he he a di ng a nd s ub- he a di ng. Re a d c orr es po ndi ng Secti o n Not es a nd Cha pt er Not es ( Rul e 1 of GI R) I f t her e i s no a mbi g ui t y or c o nf usi o n, t he cl assi fic ati o n i s final. Yo u do not have t o l ook t o cl assi fic ati o n r ul es or t r a de pr acti ce or di cti o nar y me a ni ng. I f cl assi fic ati o n i s not possi bl e, t he n o nl y g o t o GI R The r ul es ar e t o be a ppli e d s e q ue nti all y
( 2) I f me a ni ng of wor d i s not cl e ar, r ef er t o t r a de pr acti ce I f t r a de underst a ndi ng of a pr o d uct c a nnot be est a bli s he d, find t ec hni c al or di cti o nar y me a ni ng of t he t er m us e d i n t he t ari ff. Yo u may al s o r ef er t o BI S or ot her st a ndar ds, b ut trade parlance i s most i mport a nt
( 3) I f g oo ds ar e i nc o mpl et e or un- fini s he d, b ut cl assi fic ati o n of fini s he d pr o d uct i s k no wn, find i f t he un- fini s he d i t e m has essential characteristics of fini s he d g oo ds. I f s o, cl assi f y i n s a me he a di ng - Rul e 2( a).
( 4) I f a mbi g ui t y persi st s, find o ut whi c h he a di ng i s s peci fic a nd whi c h he a di ng i s mor e ge ner al. Pr ef er s peci fic he a di ng. - Rul e 3( a).
( 5) I f pr o bl e mi s not r es ol ve d by Rul e 3( a), find whi c h mat eri al or c o mpo ne nt i s gi vi ng ‘ essential character ’ t o t he g oo ds i n q uesti o n - Rul e 3( b)
( 6) I f bot h ar e e q uall y s peci fic, find whi c h c o mes l ast i n t he Tari ff a nd t a ke i t - Rul e 3( c).
( 7) I f y o u ar e una bl e t o find a ny e nt r y whi c h mat c hes t he g oo ds i n q uesti o n, find g oo ds whi c h ar e most a ki n - Rul e 4.
( 8) I n c as e of m i xt ur es or s et s t oo, t he pr oce d ur e i s mor e or l ess s a me, e xce pt t hat e ac h i ngr e di e nt of t he m i xt ur e or s et has t o be s ee n i n a bove s e q ue nce. As per r ul e 2( b), a ny r ef er e nce t o a mat eri al or s ubst a nce i ncl udes a r ef er e nce t o m i xt ur es or c o mbi nati o ns of t hat mat eri al or s ubst a nce w i t h ot her mat eri al or s ubst a nce.
( 9) Pac ki ng mat eri al i s cl assi fie d al o ng w i t h t he g oo ds e xce pt whe n t he pac ki ng i s f or r e peti ti ve us e - Rul e 5
3.4 Application of GIR in Tariff
GI R ( Ge ner al I nt er pr et ati ve Rul es) ar e t o be a ppli e d f or i nt er pr et ati o n of Tari ff, i f cl assi fic ati o n i s not possi bl e o n t he basi s of t ari ff e nt r y a nd r el e va nt c ha pt er not es a nd s ecti o n not es.
Rules to be applied sequentially - The Rul es ar e t o be a ppli e d s e q ue nti all y. Rul e 1 gi ves pr ece de nce t o Secti o n Not es / Cha pt er Not es whil e cl assi f yi ng a pr o ductChapter 5
Para 2.6 of CBI&C’s Customs Manual, 2025
Cl assi fi cati o n i s t o be fi rst t est e d i n li g ht of Rul e 1. Onl y whe n i t i s not possi bl e t o r es ol ve t he i ss ue by a ppl yi ng t hi s r ul e, r ec o urs e i s t a ke n t o Rul es 2, 3 a nd 4 i n s eri ati m [ Tho ug h r ul es no wher e st at e t hat t hes e s ho ul d be a ppli e d s e q ue nti all y, t he ge ner al arr a nge me nt a nd wor di ng does cl earl y i ndi cat e t hat i nt e nti o n].
Titles are for referenceTi tl es of s ecti o ns or c ha pt ers c a nnot be us e d f or cl assi fic ati o n. The ti tl es of s ecti o ns a nd c ha pt ers ar e pr ovi de d f or us e of r ef er e nce o nl y, a nd have no l e gal i mport a nce f or p ur pos es of cl assi fic ati o n. ( Rul e 1)
Rule 1
- The ti tl es of Secti o ns a nd Cha pt ers ar e pr ovi de d f or e as e of r ef er e nce o nl y; f or l e gal p ur pos es, cl assi fic ati o n s hall be det er m i ne d acc or di ng t o t he t er ms of t he he a di ngs a nd a ny r el ati ve Secti o n or Cha pt er Not es a nd, pr ovi de d s uc h he a di ngs or Not es do not ot her w i s e r e q ui r e, acc or di ng t o t he pr ovi si o ns her ei naft er c o nt ai ne d
Section Notes and Chapter Notes have overriding effectCl assi fic ati o n i s t o be det erm i ne d o nl y o n t he basi s of des cri pti o n of t he he a di ng, r e a d w i t h r el e va nt s ecti o n or c ha pt er not es Si nce t hes e not es ar e part of t he Act i t s el f, t hes e have f ull st at ut or y (l e gal ) bac ki ng. Tri b unal has (very rightly ) hel d t hat c over age of r es pecti ve he a di ngs has t o be det er m i ne d i n t he li g ht of r es pecti ve s ecti o n not es a nd c ha pt er not es. I n t hi s s e ns e, Secti o n Not es a nd Cha pt er Not es have a n overri di ng f or ce over t he r es pecti ve he a di ngs a nd s ub- he a di ngs.* Saurashtra Chemicals, Porbunder v. CC - 1986 ( 23) ELT 283 ( CE GAT) * Tractors and Farm Equipments Ltd. v. CC - 1986 ( 25) ELT 235 ( CE GAT) * Track Parts Corporation v CC - 1992 ( 57) ELT 98 ( CE GAT) * Calcutta Steel Industries v. CCE - 1991 ( 54) ELT 90 ( CE GAT). I n Fenner (India) Ltd. v. CCE - 1995( 97) ELT 8 ( S C), i t was o bs er ve d t hat t ari ff s c he d ul e wo ul d be det er m i ne d o n t er ms of he a di ngs a nd a ny r el e va nt s ecti o n or c ha pt er not es I n CC v Sanghvi Swiss Refills P Ltd. 1997( 94) ELT 644 ( CE GAT), i t was hel d t hat s ecti o n not es a nd c ha pt er not es, bei ng st at ut or y i n nat ur e, have pr ece de nce over f uncti o nal t est a nd c o mmer ci al parl a nce f or p ur pos es of cl assi fic ati o n I n sli g htl y c o nt r ar y vi e w , i n Kesharbhai Electronics v. CCE 2001( 130) ELT 852 ( CE - GAT), i t was hel d t hat wher e cl assi fic ati o n i s possi bl e o n per us al of he a di ng, t he n t her e wo ul d be no nee d t o g o by t he s ecti o n not e or c ha pt er not e. [ Thi s was pr o ba bl y o n f act s of t he c as e].
If the description read with section or chapter notes is not enough to correctly classify the goods, following further rules have been provided :
3.4-1 Classification of Incomplete or un-assembled Goods
Any r ef er e nce t o c o mpl et e g oo ds al s o i ncl udes i nc o mpl et e or un- fini s he d g oo ds, i f s uc h i nc o mpl et e or un- fini s he d g oo ds have t he ess e nti al c har act eri sti c of fini s he d g oo ds. [ first part of Rul e 2( a)]. The he a di ng will al s o i ncl ude fini s he d g oo ds r e move d un- ass e mbl e d or di s ass e mbl e d i. e. i n S KD or C KD pac ks. [ s ec o nd part of Rul e 2( a)].
Rule 2(a) - Any r ef er e nce i n a he a di ng t o g oo ds s hall be t a ke n t o i ncl ude a r ef er e nce t o t hos e g oo ds i nc o mpl et e or unfini s he d, pr ovi de d t hat, t he i nc o mpl et e or unfini s he d g oo ds have t he ess e nti al c har act er of t he c o mpl et e or fini s he d g oo ds. It s hall al s o be t a ke n t o i ncl ude a r ef er e nce t o t hos e g oo ds c o mpl et e or fini s he d ( or f alli ng t o be cl assi fie d as c o mpl et e or fini s he d by vi rt ue of t hi s r ul e), r e move d unass e mbl e d or di s ass e mbl e d So me ill ust r ati o ns i n HS N Ex pl a nat or y not es ar e* a mac hi ne or a ppar at us nor mall y i nc or por ati ng a n el ect ri c mot or i s cl assi fie d i n t he s a me he a di ng e ve n i f pr es e nt e d w i t ho ut mot or. * Pass e nger c oac h not fitt e d w i t h s e at s will still be a pass e nger c oac h * Mot or ve hi cl e not yet fitt e d w i t h wheel s, batt er y or t yr es * Bi c ycl es w i t ho ut s a ddl es a nd t yr es * Phot ogr a p hi c c a mer a w i t ho ut a n opti c al el e me nt * El ect ri c s uppl y met er w i t ho ut i t s t ot alli ng de vi ce.
I n Salora International Ltd. v. CCE ( 2012) 9 S CC 662 = 284 ELT 3 ( S C), ass ess ee ma n u - f act ur e d vari o us c o mpo ne nt s of T V s et s. Thes e wer e ass e mbl e d f or t esti ng of e ac h s et. The n t he s et s wer e di s ass e mbl e d a nd t he n t r a ns port e d as part s t o ot her uni t s ( s at elli t e uni t s) of ass ess ee t o be r eass e mbl e d a nd mar ket e d. I ndi vi dual s eri al nu mbers wer e gi ve n. It was hel d t hat t he g oo ds have t o be cl assi fie d as fini s he d/c o mpl et e g oo ds a nd not as part s. It was hel d t hat i f o nl y part s wer e ma n uf act ur e d a nd mat c hi ng a nd n u mberi ng f uncti o ns wer e do ne at s at elli t e uni t s, i t wo ul d have bee n r e moval of part s of T V s et s.
Sc oot er bo dy uni t w i t ho ut e ngi ne i s cl assi fia bl e as s c oot er.LML Ltd. v. CC 1999( 105) ELT 718 ( CE GAT)
I n J K Synthetics v. CCE 2000( 123) ELT 1166 ( CE GAT), i t was hel d t hat ‘ ess e nti al c har - act er ’ i s not de pe nde nt o n wei g ht or val ue of t he mat eri al or c o mpo ne nt s of whi c h g oo ds ar e ma de of.
CUSTOMS & FOREIGN TRADE POLICY (FTP) READY RECKONER
AUTHOR : V.S. Datey
PUBLISHER : Taxmann
DATE OF PUBLICATION : April 2026
EDITION : 28th Edition | 2026
ISBN NO : 9789375611226
NO. OF PAGES : 976
BINDING TYPE : Paperback
2,595
DESCRIPTION
Customs & Foreign Trade Policy Ready (FTP) Reckoner, is a single-volume treatise consolidating the entire body of Indian indirect tax law on cross-border trade. For nearly three decades, it has been the standard desk reference relied upon for written submissions, legal opinions, and departmental guidance.
The book covers the full statutory edifice of India's Customs and trade regime—the Customs Act 1962; the Customs Tariff Act 1975 (both Schedules, including CVD, Anti-Dumping, Safeguard, and CVD-on-subsidised-goods machinery); the FT (D&R) Act 1992; the SEZ Act 2005 and Rules 2006; the IFSCA Act 2019; and the Foreign Trade Policy 2023 with the Handbook of Procedures. It integrates the subordinate framework of valuation rules, baggage rules, courier regulations, customs broker regulations, warehousing regulations, MOOWR, drawback rules, SEZ rules, RoDTEP/RoSCTL schemes, SCOMET controls, and the Provisional Collection of Taxes Act 2023
The law stated is current as of the Finance Act 2026 and incorporates all CBIC and DGFT notifications up to the cut-off, including the Baggage Rules 2026 and CBDPR 2026 (effective 2-2-2026). The CBIC Customs Manual 2025 (superseding the 2023 Manual) is cross-referenced throughout.
The Reckoner is designed for readers who need to work with both the underlying statute and the operating circulars simultaneously:
• Tax Advisors, Chartered Accountants, Cost Accountants, Company Secretaries, and Advocates
• In-House Tax and Trade-Compliance Teams
• Customs Brokers (CBs/CHAs) and Logistics Professionals
• Officers of the CBIC, DGFT, DRI, SVB, SEZ Development Commissioners, and IFSCA
• Trade Bodies, Exporters' Associations, Consultants, And Policy Researchers
• Candidates Preparing for the CA Final, CS Professional, CMA Final, Departmental Examinations
The Present Publication is the 28th Edition | 2026, amended by the Finance Act 2026. It is authored by Mr V.S. Datey, with the following noteworthy features:
• [Four-Layer Integrated Treatment at Every Paragraph] Statutory text subordinate legislation administrative guidance (CBIC circulars, Customs Manual 2025, DGFT circulars, MCI-DC(SEZ) instructions, RBI circulars) leading judicial authority. This citation density allows direct use in written submissions
• [Extensive Case-Law Commentary] Woven into the narrative at the point of discussion, drawing on Supreme Court Constitution Benches, 3-member SC benches (Apar P. Ltd., Kiran Spinning Mills, Garden Silk Mills), High Court Division Benches, CESTAT, and recent rulings including UOI v. Mohit Minerals (P.) Ltd.
• [Author's Editorial Notes and Interpretative Critique] Flags conflicting judgments, weak departmental positions, and practical pitfalls—not merely a statement of the law
• [Paragraph-Numbered Drafting] Enables precise cross-referencing in opinions, SCN replies, and submissions before adjudicating authorities and Tribunals
• [FTP Paragraph-Level Citation (Chapters 42–61)] Maps commentary directly to FTP 2023 paragraphs, HBP paragraphs, and Customs notifications in the FTP machinery
• [Cross-Comparison with the CGST Act] Highlights shared architecture—transaction value, related persons, unjust enrichment, short-levy recovery, advance ruling, search & seizure, arrest & prosecution
• [Section-Wise Index to the Customs Act 1962] Maps every section (including lettered and inserted provisions such as 2(28A), 28J, 56A, 151A) to paragraph numbers, enabling section-first navigation
• [Glossary of Acronyms and Subject Index] Full operating vocabulary and topic-first lookup
• [CBIC Customs Manual 2025 Integration] Cited at relevant paragraphs throughout, with chapter and paragraph references
