Clarification on Camera Module of Cellular Mobile Phones for Custom duty levy

Clarification on Camera Module of Cellular Mobile Phones for Custom duty levy

CBIC has issued clarification on Camera Module of Cellular Mobile Phones for the purpose of concessional and/or exemption from custom duty levy

CBIC Notification No. 57/2017-Customs dated 30.06.2017 prescribed concessional basic custom duty (BCD) rate of 10%  on the camera modules for use in manufacture of a cellular mobile phone and  inputs or  parts  including  the  camera  lens  or  sub-parts  of  the  parts used in the manufacture of the camera modules have been fully exempted from BCD.

Subsequently, Directorate of Revenue Intelligence (DRI) sought issuance of clarification on the scope of camera module as per said Notification No.  57/20217 stating that the camera module and its contents have not been defined/specified till date. An investigation carried out by DRI raised doubts on whether on two camera modules sealed in a metal chassis bracket can be treated as camera module considering that if the chassis was imported separately, the same would attract 15% for the period prior to 30.01.2024.

As per the said DRI investigations, imports of camera modules consist of not only camera but other parts of mobile phones, such as flexible printed circuit having connectors, plastic cover, metal chassis with space/cavity for other components of mobile phone, cover plates, camera modules fitted in the metal chassis.

Based on the inputs of the Ministry of Electronics and Information Technology (MeitY) CBIC has issued Circular No. 08/2025-Customs dated 24.03.2025 to clarify the scope of the camera modules used in the manufacture of cellular mobile phones.

In order to ensure uniformity of practice on what constitutes essential character of the camera module of the mobile phones, the following clarification has been issued:

1.The camera module is a combination of various parts and components such as lens, sensor, FPCB Assembly, bracket/holder, connectors, mechanical parts etc. based on the design of the model of the mobile phone. The camera module for use in manufacturing of cellular mobile phones has an essential character of the camera and should be classified as camera module in terms of Rule 3(b) of the General Rules of Interpretation (GRI) of the Harmonised System.   In cellular mobile phone sector, technology gets outdated in a short span of time. Due to technological advancements, the components are amalgamated or removed or ameliorated, the parts, the sub parts, micro and macro sub parts are required to be modified periodically. Therefore, the “essential character” criteria should be followed for the classification of the camera module.

2.The camera module (including singular or multiple cameras) designed with specific components such as lens, sensor, FPCB Assembly, bracket/holder, connectors, mechanical parts etc. for the purpose of integrating the camera module and merely add the strength, ensure the structural stability and protection in mobile phones shall be classified as camera modules of the mobile phones as long as its functionality remains limited to that of a camera.

3.As was clarified in the context of display assembly, parts/components of camera module which do not have a function of their own and do not add any functionality to the principal function of the camera module of mobile phones and/or merely add strength, protection and structural stability should be considered as camera module when imported as a complete assembly.

4.Accordingly, when a camera module is imported as an integrated assembly, it shall continue   to attract the concessional basic customs duty rate as prescribed in Notification No. 57/2017-Customs dated 30.06.2017. However, where the components of a camera module are imported individually (not as a complete assembly), they shall attract the applicable BCD rate.

• FCRA specifies list of 105 purposes to be selected for which registration is applied
• Withholding tax u/s 40(a)(i) not required on cost-to-cost reimbursement made to parent company
• Temporarily blocking public access to Telegram App not disproportionate – Delhi High Court
• High Court explains the meaning of term ‘enterprise’ appearing in section 80IA
• Addition deleted as assessee was only a carrier of cash not owner who came up to own it