The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the Modern HIV Diagnostic Kits are eligible for customs duty exemption and concessional 5% IGST.
The bench of Justice Dilip Gupta (President) and Hemambika R. Priya (Technical Member) has observed that the test kits imported by the appellant are diagnostic kits used for detection and prognosis of HIV virus in the human body. Thus, a purposive interpretation has to be extended to the entry in the Notification so as to give the benefit of duty not only diagnostic kits for detection of HIV antibodies but to also other technologically advanced diagnostic kits used for detection and prognosis of HIV, as they serve the same purpose. The object and purpose behind the introduction of exemption to HIV kits was in public interest to support the high demand of healthcare at affordable prices and to curb the spread of HIV virus in India.
The appellant/assessee is engaged in the business of import and supplies of the imported test kits and reagents which are supplied to medical institutions like AIIMS Delhi, AIIMS Rishikesh, CMC Vellore, PGI Chandigarh and Sri Gangaram Hospital in India. The appellant has been importing these imported test kits from its foreign supplier M/s Grifols (HK) Limited. The imported test kits are used at hospitals and blood banks for screening of blood for the purpose of detecting HIV and Hepatitis.
The appellant cleared the imported test kits by claiming benefit of ‘Nil’ Basic Customs Duty and 5% IGST. According to the appellant, the imported test kits are eligible for exemption from BCD under Serial No. 167(A) of the Exemption Notification and concessional rate of 5% IGST under Serial No. 180 of Schedule I to the IGST Rate Notification.
The department disputed the eligibility of the appellant to claim the benefit of the aforesaid Exemption Notification and the appellant deposited 100% of the disputed differential duty (BCD @ 30% and IGST @12%) under protest. Later, based on legal advice, the appellant during the investigation believed that the imported test kits would be classifiable under CTI 3822 00
According to appellant, the department refused to allow the appellant to re-classify the product under CTI 3822 00 19 as against CTI 3822 00 90 which the appellant had adopted earlier.
The adjudicating authority the held that test kits imported by the appellant under the 6 Bills of Entry filed in the month of July, 2021 are appropriately classifiable under CTI 3822 00 90 and would not be eligible for benefit of the Exemption Notification and the reduced rate @5% IGST Rate Notification.
The tribunal held that the test kits imported by the appellant support the larger public interest objective of the National Aids Control Programme aimed at halting and reversing the HIV epidemic in India. The test kits imported by the appellant would be entitled for exemption from BCD and only 5% integrated tax as provided for in List 1 of the IGST Rate Notification would be payable by the appellant.
The CESTAT while allowing the appeal held that the order passed by the Commissioner (Appeals) holding that the imported test kits are not eligible for the benefit of the Exemption Notification or the reduced rate of IGST under the IGST Rate Notification cannot be sustained and is set aside.
Case Details
Case Title: M/s. Hemogenomics Pvt. Ltd. Versus Commissioner of Customs (Appeal)
Case No.: CUSTOMS APPEAL NO. 55291 OF 2023
Date: 06.08.2025
Counsel For Appellant: Sandeep Chilana, Shri Priyojeet Chhatterjee, Shri Snehil Sharma and Shri Vindaya Agarwal
Counsel For Respondent: S.K. Rahman, Authorized Representative
