CAAR Mumbai: MILDS Aircraft Defence Components Qualify for Customs Duty Exemption — Key Ruling on Notification No. 45/2025-Customs
Background and Overview of the Application
The Customs Authority for Advance Rulings, Mumbai (CAAR) was called upon to adjudicate whether three critical components proposed to be imported by M/s Pinaka Aerospace Solutions Pvt. Ltd. would qualify for exemption from customs duty under Sl. No. 60 of Table II to Notification No. 45/2025-Customs dated 24.10.2025. The application was filed under Section 28H of the Customs Act, 1962, and received by the CAAR Secretariat on 17.02.2026.
The applicant, M/s Pinaka Aerospace Solutions Pvt. Ltd. (IEC No. 0707004497), is a Bengaluru-based entity engaged in the field of avionics, electronic-warfare, and communication systems. Its registered office is situated at Plot-16, KIADB Hi Tech Defense and Aerospace Park, Mahadevakodigehalli Village, Bangalore North, Bangalore — 562 149. The company proposed to import the subject components from HENSOLDT, Germany, and assemble them at its Bengaluru facility into the HENSOLDT MILDS AN/AAR-60 Block 2 Missile Warning System, which was intended for exclusive supply to the Indian Defence Forces.
The Three Components: Identity and Function
The goods in question — collectively referred to as the "subject goods" — consist of three distinct components that form integral parts of the MILDS Block 2 Missile Warning System:
1. MILDS F SUOF Lens V2 (Front-end Sensor Unit Optics)
- HSN Code: 9031 90 00
- A high-precision passive imaging lens engineered for the UV solar-blind spectral band
- Provides a wide-angle, true-imaging field of view enabling 360° coverage
- Detects UV radiation signatures from hostile missile exhaust plumes
- Computes direction of arrival and triggers automatic countermeasures
2. Front End (M2FE) V2.11
- HSN Code: 7610 90 90
- The optical and detector assembly at the core of each sensor head
- Performs real-time, high-speed data processing for UV signature detection and missile classification
- Triggers countermeasures — including flares and DIRCM — within milliseconds of threat identification
3. MILDS F SUII Coupled V2.5 Series
- HSN Code: 8543 90 00
- Acts as the primary digital bridge between the Front End (M2FE) sensor modules and the aircraft's Mission Management System / Countermeasure Signal Processor
- Synchronises data streams from multiple sensor heads (typically four to six) to provide a seamless 360° spherical threat-protection picture
Note: Once assembled, these three components constitute the complete MILDS Block 2 Missile Warning System, which is thereafter installed as part of the Electronic Warfare (EW) suite on MI-17 V5 and MLH helicopters operated by the Indian Air Force.
The Exemption Entry: Sl. No. 60 of Table II to Notification No. 45/2025-Customs
The exemption entry central to this ruling reads as follows:
| Sl. No. | Chapter / Heading | Description of Goods | Standard Rate | IGST | Condition No. |
|---|---|---|---|---|---|
| 60 | Any Chapter | Parts, sub-assemblies, spares, accessories, tools, testing equipment, literature for goods like artillery weapons, rifles, aircrafts, etc. except for 12.7mm SRCG, 155mm/45 Cal. Dhanush, L-70 Gun, 84mm RL Mk-III, AK-630 Naval Guns, Light Machine Gun, MAG Gun: Provided that nothing contained in this S. No. shall have effect on or after the 1st July, 2029. | Nil | Nil | 17 |
Condition No. 17 (Annexure to Table II)
The exemption under Sl. No. 60 is conditional upon satisfaction of Condition No. 17, which stipulates:
"If imported into India by the Ministry of Defence, or the Defence forces, or the Defence Public Sector Units, or other Public Sector Units, or any other entity, for the Defence forces, subject to the following conditions, namely:
(i) an officer not below the rank of Joint Secretary to the Government of India in the Ministry of Defence certifies, (a) the quantity, description and technical specifications of the imported goods and (b) that the said goods are intended for the purpose of and use by the defence forces only and recommends the grant of exemption to the imported goods;
(ii) the importer shall, at the time of import, furnish the said certificate to the Deputy Commissioner of Customs or the Assistant Commissioner of Customs, as the case may be."
Applicant's Legal Submissions
Maintainability
The applicant grounded its application in Section 28H(2)(b) of the Customs Act, 1962, which permits an advance ruling on the applicability of a notification issued under Section 25(1) of the said Act. The applicant confirmed that the goods were yet to be imported and that the prescribed fee had been duly paid. It also represented that the question raised was not pending before any Customs officer, Appellate Tribunal, or Court in its own case.