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 an earlier notification, No. 19/2026-Customs, dated May 30, 2026.
Point 2
The primary purpose is to prolong the period during which raw cotton imports will not attract customs duty, thereby providing relief to the textile industry and ensuring a stable supply of raw materials.
3. Classification & Tax Rate Applicability
The exemption, which was originally set to expire on October 31, 2026, has now been extended until December 31, 2026.
4. Timelines & Statutory Deadlines
This extension is effective immediately from the date of publication, October 30, 2026.
Point 5
For taxpayers, particularly textile manufacturers and importers of raw cotton, this means continued cost savings on imports for an additional two months, helping to manage input costs and potentially stabilize product pricing in the domestic market.
Point 6
It reflects the government's intent to support the textile sector amidst prevailing economic conditions.
Procedural Changes & Compliance Impact
- The expiry date for customs duty exemption on 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.
- The new exemption expiry date is December 31, 2026, replacing the previous date of October 31, 2026.: Ensures continued availability of duty-free raw cotton for the textile industry, supporting their operational costs and competitiveness.
- Amendment made to Notification No. 19/2026-Customs, dated May 30, 2026.: Clarifies the legal basis and continuity of the exemption, providing certainty to trade and industry stakeholders.