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, 2022 (IGCR Rules), and Customs Notification No. 45/2025 and various other standalone Customs Notifications.

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)

Start Now

Benefits

Benefit Type

Result for Importer

Duty Savings (BCD, SWS)

Direct cost reduction

Improved Working Capital

No blocking of duty amounts

Allowed Job Work

Flexibility in manufacturing

No Physical Control by Customs

Self-regulated regime

Applicable Across Sectors

Electronics, EV, Pharma, Engineering, Solar, Auto, Packaging etc.

IGCR Eligibility Checklist

Who can apply

Manufacturers
Job work importers
R&D units
MOOWR + IGCR combination users
Solar, EV, Pharma, Electronics, Auto units, etc.

Non-Eligibility and Restrictions

To show expertise and transparency

Not for trading
Not for commercial resale of imported goods as such
Time-bound consumption & reporting rules

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. 45/2025 and various other standalone notifications for a wide range of products.

The Exemption

Notification No. 45/2025-Cus and Standalone Notifications

Using the powers under Section 25, the government issued Customs Notification No. 50/2017 which was later superseded and now functions under notification No 45/2025, granting concessional or nil duty on a wide range of goods under various chapter headings of the Customs Tariff Act.

Condition No. 3 of Table 1 and Condition No. 1 of Table 2 under this notification is important. As per these conditions goods imported under this notification must comply and register under the Import of Goods at Concessional Rate of Duty Rules, 2022 are complied with.

In addition to this principal notification, multiple standalone notifications and periodic amendments have been issued over time, permitting the import of various categories of goods across diverse chapter headings at nil or concessional rates of duty, subject to registration and compliance under the IGCR Rules, 2020.

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, 2022.

Compliance Mechanism – IGCR Rules, 2022

The Import of Goods at Concessional Rate of Duty Rules, 2022 (IGCR Rules) lay down the procedure to avail duty exemption under conditional notifications like 45/2025 and other standalone exemption notifications.

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 and Bank Guarantee

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. 45/2025 and other such standalone notifications

Grants duty exemption on certain goods, subject to conditions

Condition 3 of Table 1 and condition 1 of Table 2 of Notification

Makes IGCR Rules compliance mandatory for manufacturers

IGCR Rules, 2022

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.

Frequently Asked Questions (FAQs) for IGCR

Is registration/approval required to avail IGCR?

Yes. The importer must file an online Prior Intimation on the ICEGATE portal and obtain an IGCR Identification Number (IIN) before clearance of goods.

What is an IGCR Identification Number (IIN)?

IIN is a unique number generated after filing prior intimation. It must be quoted in the Bill of Entry and linked with the bond executed with Customs.

What is Condition 3 of Table 1 and 1 of Table 2 of Notification 45/2025?

These conditions mandate that importers must comply with IGCR Rules, 2022 in order to claim concessional duty benefits under this notification.

Can imported goods be sent to a job worker?

Yes. IGCR permits the movement of imported goods to one or more job workers, subject to proper challan, tracking, and reconciliation.

Can IGCR be availed along with other schemes such as MOOWR?

Yes, it can be combined in some cases. A professional review is advised before combining schemes

What are the compliance requirements under IGCR?

Importers must:

Execute a continuity bond
Maintain detailed consumption and stock records
File quarterly IGCR-3 returns
Allow inspection/audit by Customs

What if imported goods are not used for the intended purpose?

The importer must pay duty with interest on unused, lost, diverted, or unaccounted goods. Customs may also initiate action for non-compliance.

Is there any physical control by Customs under IGCR?

No physical control is exercised. The scheme is trust-based, but Customs may conduct audits, inspections, and verification.

Can scrap, waste, or by-products be cleared?

Yes, but such clearances may require duty payment or intimation, based on the nature of wastage. Proper accounting is essential.

Is IGST also exempt under the ICGR scheme?

No IGCR provides concessions only on basic customs duty.

Is depreciation allowed under IGCR?

Yes, depreciation is allowed under the Import of Goods at Concessional Rate of Duty (IGCR) rules, for imported capital goods that are cleared into the domestic market after being used for a specified purpose. The depreciation on capital goods is calculated on a straight-line method, based on the duration for which the goods have been in use. The depreciated value is used to determine the final customs duty payable.

Reach out to us.

Sign up to our newsletter

Get regular updates on schemes directly to your email!