Businesses looking to import goods at concessional or zero customs duty must understand the interplay between Section 25 of the Customs Act, 1962, the Import of Goods at Concessional Rate of Duty Rules, 2017 (IGCR Rules), and Customs Notification No. 50/2017.

Below is a step-by-step overview of how these legal instruments work together to provide customs duty relief for eligible importers

Import of Goods at Concessional Rate (IGCR)

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Legal Foundation

Section 25 of the Customs Act, 1962

The journey begins with Section 25, which empowers the Central Government to exempt goods from customs duty, either absolutely or subject to conditions.

Section 25(1) allows the government to issue notifications granting exemptions.

These exemptions can be either:

Absolute (unconditional), or
Conditional, requiring compliance with certain rules or conditions.

This provision is the statutory basis for issuing exemptions like those found in Notification No. 50/2017.

The Exemption

Notification No. 50/2017-Cus

Using the powers under Section 25, the government issued Customs Notification No. 50/2017, granting concessional or nil duty on a wide range of goods.

Condition No. 9 under this notification is important. As per conditions 9 good imported under this notification must comply and register under the Import of Goods at Concessional Rate of Duty Rules, 2017 are complied with.

So, to avail benefit under this notification, the importer must:

Be a manufacturer or import goods for jobs work; and
Comply with the IGCR Rules, 2017.

Compliance Mechanism – IGCR Rules, 2017

The Import of Goods at Concessional Rate of Duty Rules, 2017 (IGCR Rules) lay down the procedure to avail duty exemption under conditional notifications like 50/2017.

1. Prior Intimation to Customs

The importer must submit a prior online intimation to the jurisdictional Customs Officer, providing:

Description and quantity of goods,
Purpose of import,
Manufacturing details, etc.

An IGCR identification Number (INN) will be generated after

2. Execution of Bond

Before clearance, the importer must execute a continuity bond with Customs, covering the differential duty amount (in case the conditions are not met). IIN and bond details must be mentioned in the Bill of Entry.

Customs officer will validate and allow benefit

3. Maintain Records

Importers must maintain detailed records of following and also submit quarterly statements (IGCR-3):

Quantity/value of imported goods
Dates of receipt
Use (domestic/external/job work/export)
Goods sent/received for job work
Re-exports
Stock

4. Record Maintenance and Inspection

Importer must maintain books of accounts and production records for inspection.
Customs may verify usage to ensure no misuse.

Section 25

Enables government to issue exemption notifications

Notification No. 50/2017

Grants duty exemption on certain goods, subject to conditions

Condition 9 of Notification

Makes IGCR Rules compliance mandatory for manufacturers

IGCR Rules, 2017

Provide step-by-step process for availing the exemption

Need Help With IGCR Compliance or Claiming Exemptions?

At CCC, we assist importers in:

Checking for edibility for availing exemption under the ICGR Rules

Assistance in getting registration under the IGCR Rules

Assistance in drafting and execution of Continuity Bond

Filing returns and maintaining records

Responding to Customs queries and audits.