The Central Government has issued Notification No. 03/2026-Customs, effecting targeted but significant changes to existing customs duty exemption notifications by adding new tariff headings, omitting certain entries, and restructuring concessional rates under two major exemption frameworks.
The notification, published in the Gazette of India (Extraordinary), forms part of the government’s broader exercise to rationalise import duty exemptions announced alongside Budget 2026.
Statutory Authority and Scope
The notification has been issued under Section 25(1) of the Customs Act, 1962, read with Section 110 of the Finance Act, 2018 and Section 124 of the Finance Act, 2021, empowering the Centre to amend exemption notifications in public interest.
Through this notification, the government amends:
- Notification No. 11/2018-Customs (dated 2 February 2018), and
- Notification No. 11/2021-Customs (dated 1 February 2021).
Expansion of Eligible Tariff Headings from May 2026
Under Notification No. 11/2018-Customs, the government has expanded the list of eligible tariff headings by inserting several new HS codes with effect from 1 May 2026. These include tariff entries under headings 2106, 2504 and 2506, 2811, and 3801.
The move broadens the scope of goods eligible for concessional customs treatment, while clearly deferring applicability to allow industry time for transition and compliance.
Omission of Entries Signalling Withdrawal of Benefits
At the same time, the notification withdraws select exemptions by omitting entire serial numbers:
- Serial No. 7 under Notification No. 11/2018-Customs will stand omitted from 1 May 2026;
- Serial No. 8H will be omitted earlier, from 1 April 2026.
These deletions indicate the government’s intent to phase out certain exemptions that are either sunset-linked or no longer aligned with current policy objectives.
Redefinition of Scrap and Waste-Related Exemptions
A notable amendment relates to spent catalysts and ash containing precious metals. Serial No. 54A has been substituted to specifically cover spent catalysts or ash falling under tariff heading 7112, effective 1 April 2026. This clarification is expected to reduce classification disputes and bring uniformity in assessment of such imports.
Similarly, Serial No. 59 has been substituted to extend coverage to all goods falling under heading 9503, ensuring clarity in the scope of concessional treatment for these items.
Amendments to Notification No. 11/2021-Customs
Under Notification No. 11/2021-Customs, a new Serial No. 13A has been introduced, granting a concessional customs duty rate of 0.5% for goods falling under tariff heading 4011 30 00, subject to cross-referencing with Serial Nos. 155 and 156 of Table I of Notification No. 45/2025-Customs.
In addition, Serial No. 20 (item iv) under column (3) has been omitted with effect from 1 April 2026, reflecting further pruning of exemptions.
Effective Date and Transitional Impact
While the notification itself comes into force on 2 February 2026, most substantive changes take effect from 1 April 2026 or 1 May 2026, providing importers a limited transition window to reassess eligibility, pricing, and compliance strategies.
Notification Details
Notification No. 03/2026-Customs
Date: 01/02/2026
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