CBIC Clarifies: Stationary and Industrial Battery Energy Storage Systems Are Not 'Power Banks' — 10% Concessional BCD Applies
Background and Context
The Central Board of Indirect Taxes and Customs (CBIC), operating under the Ministry of Finance, Department of Revenue, has issued Circular No. 45/2026-Customs dated 9th October 2026, bringing much-needed clarity on the scope of the term "Power Bank" as used in the customs exemption framework. The circular specifically addresses how the term should be interpreted under Serial No. 325 of Table I of Notification No. 45/2025-Customs dated 24 October 2025, and its bearing on the concessional Basic Customs Duty (BCD) rate applicable to lithium-ion Battery Energy Storage Systems (BESS) classified under tariff item 8507 60 00.
This clarification has direct and immediate relevance for importers, project developers, and energy infrastructure companies engaged in the import of stationary, grid-scale, and industrial-grade lithium-ion BESS units into India.
The Customs Duty Framework for Tariff Item 8507 60 00
Applicable Notification Entry
Serial No. 325 of Table I of Notification No. 45/2025-Customs dated 24 October 2025 prescribes a concessional BCD rate of 10% for goods falling under tariff item 8507 60 00 (lithium-ion accumulators/batteries). However, this concessional rate is expressly made unavailable for three specific categories of goods, which are explicitly carved out as exclusions:
- Battery packs intended for use in the manufacture of electrically operated vehicles or hybrid vehicles
- Lithium-ion batteries or battery packs of cellular mobile phones
- Power Banks
The standard tariff rate applicable to goods classified under HSN 8507 60 00 is 20%. The concessional rate of 10% under the notification therefore represents a significant duty relief, making clarity on exclusions critically important from an assessment standpoint.
It may also be noted that this notification entry corresponds to Serial No. 528C of the erstwhile Notification No. 50/2017-Customs dated 30 June 2017, which has since been subsumed into the consolidated customs exemptions framework under the 2025 notification.
The Problem: Divergent Field Practices
CBIC observed, through representations and internal reporting, that customs field formations across the country were not adopting a uniform approach while assessing imports of Battery Energy Storage Systems under tariff item 8507 60 00.
Specifically, certain field formations were treating stationary, grid-scale, and industrial BESS as "Power Banks", thereby applying the exclusion and denying the concessional BCD rate of 10% to such imports. As a consequence, these BESS units were being assessed at the full tariff rate of 20%, causing significant duty burden on importers of large-scale energy storage infrastructure.
This inconsistency in assessment practice created: