Case Details: Commissioner of Customs (Preventive), New Delhi vs. Ambrane India Pvt. Ltd. (2025) 36 Centax 387 (S.C.)
Judiciary and Counsel Details
- J.B.Pardiwala & K.V. Viswanathan, JJ.
- S/Shri N.Venkataraman, A.S.G., Gurmeet Singh Makker, AOR, Sudhakar Kulwant, V.C. bharathi, Prerna Dhal, Ishaan Sharma, Chandra Kant Sharma, Advs. for the Petitioner.
- S/Shri Rajesh Rawal, Avd., Deepak Agrawal, AOR, Ms. Ruchika Jain, Adv. for the respondent.
Facts of the Case
The appellant challenged the order of the CESTAT which upheld the assessee’s claim of concessional duty under Entry No. 512 of Notification No. 50/2017-Cus., dated 30-06-2017. The record showed that the assessee imported lithium-ion cells, cables, nickel and stainless-steel strips, protective casings, heat-resistant tapes, insulation materials, foam stickers, glues, screws and other components for manufacture in compliance with the procedure under the Customs (Import of Goods at Concessional Rate of Duty) Rules, 2017 (IGCR Rules, 2017). The imported cells were welded using the imported strips, insulated with the imported tapes and stickers, and packed with foam stickers inside the imported protective casings, at which stage a lithium-ion battery emerged as a distinct product; these batteries were thereafter used captively for power banks by connecting them to a printed circuit board, while the assessee sold the output as lithium-ion battery packs. CESTAT held that this transformation satisfied ‘manufacture’ under Rule 3(e) of the IGCR Rules and that the exemption under Entry No. 512 could not be denied on the basis of captive use. The matter was accordingly placed before Hon’ble Supreme Court.
Supreme Court Held
The Hon’ble Supreme Court held that there was no ground to interfere with the CESTAT order which had found that the sequential welding, insulating and casing of the imported inputs resulted in the emergence of a lithium-ion battery having a distinct name and use, thereby satisfying the definition of ‘manufacture’ under Rule 3(e) of the IGCR Rules. The Court observed that the subsequent captive use of such batteries for power banks by connecting them to a printed circuit board did not affect eligibility under Entry No. 512 of Notification No. 50/2017-Cus., dated 30-06-2017. The Court noted that the CESTAT’s reasoning aligned with Rules 3 and 5 of the IGCR Rules and section 130E of the Customs Act, 1962. The appeal was accordingly dismissed.
