2026-VIL-10-AAR-CU
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CUSTOMS Advance Ruling Authority

Customs AAR - Manufacture of cellular mobile phones and Printed Circuit Board Assembly - Applicability of Concessional duty exemption under Notification No. 57/2017-Customs on import of inputs and parts which subsequently scrapped during the manufacturing process - 'for use in manufacture' vs 'used' in the manufacture – Intent of Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 - HELD - The benefit under Notification No. 57/2017 is available in respect of inputs and parts 'for use' in the manufacture of PCBA and mobile phones and not in respect of inputs and parts 'used' in the manufacture of PCBA and mobile phones. The usage of words 'for use in manufacture' indicates that benefit is available in respect of all inputs and parts which have been put to use for manufacturing the PCBA and mobile phones and not only in respect of inputs and parts which form part of the finished PCBA and mobile phones. This concessional duty benefit is subject to condition which mandates the importer to follow the procedure set out in IGCR - The intent of the IGCR is to provide concessional benefit where the goods have been used during the manufacturing process and not necessarily the goods which form part of the manufactured good - The extant exemption is applicable to all the goods which are placed in the assembly line for the purpose of manufacture of display assembly irrespective of whether the same get incorporated in the manufacture of PCBA and cellular mobile phone or are damaged or scrapped during manufacturing - The Notification No. 57/2017 is clear and provides that the benefit of exemption is available for all inputs and parts used to manufacture mobile phone, irrespective of the fact that the same forms part of the finished goods or are scrapped during the manufacturing process - In the present case, as both the Notification No. 57/2017 and IGCR Rules, 2022 are clear and there is no scope of doubt or ambiguity and hence both the instrument should be read "as it is" and rule of literal construction shall apply - the concessional rate of duty under Notification No. 57/2017-Customs dated 30th June 2017, as amended is available in respect of import of various input and parts for use in manufacture of PCBA and cellular mobile phone which get subsequently scrapped during the manufacturing process subject to the applicability and conditions mentioned in IGCR Rules, 2022 – Ordered accordingly
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