𝗖𝗹𝗮𝗿𝗶𝗳𝗶𝗰𝗮𝘁𝗶𝗼𝗻 𝗼𝗻 𝗦𝗰𝗼𝗽𝗲 𝗼𝗳 𝗖𝗮𝗺𝗲𝗿𝗮 𝗠𝗼𝗱𝘂𝗹𝗲 𝗳𝗼𝗿 𝗖𝗲𝗹𝗹𝘂𝗹𝗮𝗿 𝗠𝗼𝗯𝗶𝗹𝗲 𝗣𝗵𝗼𝗻𝗲𝘀.

The government has clarified the definition of camera modules for mobile phones to ensure uniform classification and proper application of the 10% concessional BCD under Notification No. 57/2017-Customs. Only genuine camera modules qualify, while other mobile phone components are taxed separately.

Understanding the Clarification on Camera Module under Notification No. 57/2017-Customs

1. Background of the Concession:
   • Notification No. 57/2017-Customs dated 30.06.2017 provides a 10% concessional Basic Customs Duty (BCD) on camera modules used in manufacturing cellular mobile phones (S. No. 5A).
   • Inputs, parts, and sub-parts used in manufacturing camera modules, such as camera lenses, are fully exempt from BCD (S. No. 6B & 6BA).
2. Issue Raised by DRI:
   • The Directorate of Revenue Intelligence (DRI) sought clarification regarding the scope of camera modules under S. No. 5A of the notification.
   • Their concern arose because some camera modules were imported pre-fitted in a metal chassis, which also had spaces for other phone components.
   • If the metal chassis were imported separately, it would attract 15% BCD (before 30.01.2024).
   • Hence, doubts were raised about whether such assemblies should qualify as camera modules or be taxed differently.
3. Clarification Issued Based on MeitY Inputs:
   • The Ministry of Electronics and IT (MeitY) provided inputs through OM No. W-15/2/2024-IPHW dated 31.12.2024, leading to this clarification.
   • The goal is to ensure uniform classification of camera modules and prevent misinterpretation.
4. Key Clarifications on Camera Modules:
   • Definition of Camera Module:
     • A camera module consists of lens, sensor, Flexible Printed Circuit Board (FPCB) assembly, bracket/holder, connectors, and mechanical parts based on mobile phone design.
     • The essential character of the camera module is determined by its function as a camera as per Rule 3(b) of the General Rules of Interpretation (GRI) of the Harmonised System.
     • Since mobile technology evolves rapidly, parts and sub-parts may change over time, but classification should focus on the essential character of the module.
   • When is a Camera Module Eligible for 10% Concessional BCD?
     • If the imported assembly primarily functions as a camera module, it qualifies for the 10% concessional duty under S. No. 5A of the notification.
     • Even if it includes brackets, connectors, or minor mechanical parts, as long as these do not add new functionalities beyond a camera, it remains classified as a camera module.
     • Example: If the imported item consists of multiple cameras in a single unit with supporting structures for strength/stability, it is still treated as a camera module.
   • When Does a Camera Module NOT Qualify?
     • If the imported assembly includes additional mobile phone components (e.g., metal chassis with cavities for other parts, extra functional components), it does not qualify as a camera module.
     • If individual parts of the camera module (lens, connectors, PCB, etc.) are imported separately, they attract regular BCD rates, not the concessional rate.

Notification Reference: Customs
Circular No. 08/2025 Customs
24/03/2025