This CBIC notification, No. 35/2026-Customs, dated October 30, 2026, extends the customs duty exemption on raw cotton.
Key Statutory Clarifications & Analysis
Point 1
Issued under the powers conferred by Section 25(1) of the Customs Act, 1962, read with Section 124 of the Finance Act, 2021, it amends Notification No. 19/2026-Customs, dated May 30, 2026.
Point 2
The operative purpose is to prolong the period during which raw cotton imports will not attract customs duty.
3. Classification & Tax Rate Applicability
Specifically, the exemption, which was originally set to expire on October 31, 2026, has now been extended until December 31, 2026.
4. Applicability & Compliance Framework
This amendment is effective immediately from the date of publication, October 30, 2026.
Point 5
For taxpayers, particularly textile manufacturers and importers of raw cotton, this provides continued relief from import duties for an additional two months.
6. Timelines & Statutory Deadlines
This extension aims to support the domestic textile industry by ensuring the availability of raw materials at competitive prices, potentially stabilizing input costs and preventing inflationary pressures on textile products.
Point 7
It reflects the government's intent to manage supply chain dynamics and support industrial competitiveness in the short term.
Procedural Changes & Compliance Impact
- The customs duty exemption period for raw cotton has been extended.: Importers of raw cotton will continue to benefit from zero customs duty for an additional two months, reducing import costs and supporting the domestic textile industry.
- The expiry date of the exemption has been shifted from October 31, 2026, to December 31, 2026.: Taxpayers involved in raw cotton imports can plan their procurement and inventory management with the assurance of continued duty exemption until the end of 2026.
- The amendment is made to Notification No. 19/2026-Customs, dated May 30, 2026.: This clarifies the specific legal instrument being modified, ensuring proper compliance and reference for taxpayers and customs authorities.