Background:
The 56th GST Council meeting held on September 03, 2025, in New Delhi recommended that the goods listed in the notification be redefined under IGST with the rate reduced from 18% to Nil. The list covers a wide range of items, including technical documentation for exempted goods, natural cut and polished diamonds up to 25 cents, works of art and antiques, flight and target motion simulators, parts and sub-assemblies of HACFS, low noise amplifiers and related components for MRSAM systems, and parts of IADWS. It further includes military transport aircraft, deep submergence rescue vessels, unmanned underwater platforms, ejection seats for fighter aircraft, high-performance batteries for drones, communication devices, air diving equipment, sonobuoys, ship-launched missiles, rockets above 100mm calibre, and remote piloted aircraft for military use. Additionally, various parts, spares, accessories, tools, testing equipment, and literature for specified defence goods and equipment, excluding certain artillery and small arms, have also been covered under this recommendation.
Now:
The CBIC vide Notification No. 37/2025-Customs dated September 17, 2025, notifies the exemption from IGST to specified defence equipment and their parts when imported into India by the Ministry of Defence, Government of India, or the defence forces. This exemption has been issued in line with the recommendations of the 56th GST Council meeting held on September 03, 2025, in New Delhi, wherein it was decided to reduce the applicable IGST rate on such specified goods from 18% to Nil, w.e.f. September 22, 2025.
In exercise of the powers conferred by sub-section (1) of section 25 of the Customs Act, 1962 (52 of 1962) and sub-section (12) of section 3, of the Customs Tariff Act, 1975 (51 of 1975), the Central Government, being satisfied that it is necessary in the public interest so to do,
hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 19/2019- Customs, dated the 6th July, 2019, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R. 476 (E), dated the 6th July, 2019, namely:-
In the said notification, in the Table, after the Sl.No. 23 and the entries relating thereto, the following shall be inserted, namely: –
Table
| Sl.No. | Chapter or Heading or Sub-heading or tariff item | Description of goods |
| (1) | (2) | (3) |
| *24 | 88, 8536 | Flight Motion Simulator and its parts |
| 25 | 88, 8536 | Target Motion Simulator and its parts |
| 26 | Any Chapter | Parts, sub-assemblies of HACFS |
| 27 | 84, 85 | Low noise amplifier (Hermetic sealed), vent guide assembly-Return vent guided assembly-supply, vent guide assembly-NBC for MRSAM system |
| 28 | 84, 85, 87, 90, 93 | Parts and sub-assemblies of IAWDS |
| 29 | 88 | Military transport aircraft (C-140, C-295 MW) |
| 30 | 89 | Deep submergence rescue vessel |
| 31 | 89 | Unmanned Underwater vessels/platforms |
| 32 | 8807 | Ejection Seats for fighter aircrafts |
| 33 | 8506 | High performance batteries for drones and specialised equipment |
| 34 | 8525 | Communication devices including software defined radios with component and accessories |
| 35 | 9019, 9020 | Air diving, rebreather sets, diving systems, components and accessories |
| 36 | 89 | Sonobouys for Naval Air Assets |
| 37 | 93 | Ship launched missiles |
| 38 | 93 | Rockets with calibre more than 100 mm |
| 39 | 88 | RPA (Remote Pilot Aircraft) for military use |
| 40 | Any Chapter | Parts, sub-assemblies, spares, accessories, tools, testing equipment, literature for goods like artillery weapons, rifles, aircrafts, missiles, etc. except for 12.7mm SRCG, 155mm/45 Cal, Dhanush, L-70 Gun, 84mm RL Mk-III, AK-630 Naval Guns, Light Machine Guns, MAG Gun |
| 41 | 49 | Technical documentation in respect of Goods mentioned at Sl.Nos. 1 to 40 above” |
This notification shall come into force on the 22nd day of September, 2025.
The Notification can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2025/09/N-No.-37-2025-Customs.pdf
