Classification of Lithium-ion Battery Parts and Electronic Components: Analysis of CAAR Delhi Ruling in In re Navitasys India Private Limited

1. Background and Purpose of the Advance Ruling

Navitasys India Private Limited approached the Customs Authority for Advance Rulings, New Delhi (CAAR) seeking certainty on the customs classification of a wide range of imported items used in manufacturing lithium-ion batteries and related assemblies.

The application was filed under Chapter VB of the Customs Act, 1962, specifically invoking the provisions relating to advance rulings on classification of goods under the Customs Tariff Act, 1975. The complete application in Form CAAR-1 was received by CAAR, New Delhi on 16.10.2025 in compliance with Section 28H(1) (referred to as Section 281-1(1) in the text) of the Customs Act, 1962.

Navitasys India Private Limited is incorporated under the Companies Act, 1956 and operates in the field of lithium-ion battery manufacturing. Its major product lines include:

  • Smartphone batteries
  • Tablet/notebook batteries
  • Electric vehicle (2-wheeler) battery packs
  • Power bank batteries
  • Printed Circuit Board Assemblies (PCBA)

To support these manufacturing operations, the assessee imports a variety of components and materials, which it internally grouped into three broad categories for classification purposes:

  1. Category A – Items claimed as “parts” of electric accumulators/batteries and PCBA assemblies, specifically designed and used solely/principally in such final products.
  2. Category B – Independent electronic and electrical components that are not regarded as “parts” of the final product but are used in various battery and PCBA assemblies and are classifiable under their own functional headings.
  3. Category C – Supporting consumables and ancillary materials (such as adhesives, screws, labels, cables, handles, etc.) imported for use in battery manufacturing, to be classified under their respective specific tariff headings.

The assessee requested CAAR to confirm whether its proposed classifications under various Customs Tariff Headings (CTH) were correct. Alternatively, if any proposed heading was found to be incorrect, the assessee sought a definitive ruling on the appropriate classification before import, in order to ensure compliance and avoid future customs disputes.

2. Eligibility to Seek Advance Ruling

2.1 Definition of Applicant and Advance Ruling

Under Section 28E(c) of the Customs Act, 1962, an “applicant” for advance ruling includes, inter alia:

  • A person holding a valid Importer Exporter Code (IEC) under Section 7 of the Foreign Trade (Development and Regulation) Act, 1992,
  • A person exporting goods to India, or
  • Any person with justifiable cause to the satisfaction of the Authority applying under Section 28H (referred to as Section 281H/281-1 in the text).

Navitasys India Private Limited holds a valid IEC bearing no. AAGCN4086N issued under Section 7 of the FT(D&R) Act, 1992. Hence, it clearly falls within the statutory definition of “applicant”.

Section 28E(b) of the Customs Act, 1962 defines “advance ruling” as a written decision on any of the questions specified in Section 28H(2) (referred to as Section 281-1) raised in the application in respect of goods, prior to their import or export.

2.2 Questions Permissible Under Section 28H

Section 28H(2) of the Customs Act, 1962 allows an assessee to seek an advance ruling, inter alia, on:

“(a) classification of goods under the Customs Tariff Act, 1975 (51 of 1975)”

As Navitasys sought clarity only on classification of goods under the Customs Tariff Act, 1975, and submitted the application prior to import of the subject goods, all statutory preconditions for maintainability stood satisfied:

  • Valid IEC: AAGCN4086N
  • Question related to classification under Customs Tariff Act, 1975
  • Application filed in advance of import

Therefore, the application was admissible under Chapter VB of the Customs Act, 1962.

3. Scope of the Ruling: Products Covered

The assessee provided a detailed list of goods, segregated into three categories, with proposed tariff codes. Illustratively:

3.1 Category A – Items claimed as “parts” of batteries/accumulators

These include, among others:

  • Printed Circuit Board Assembly (PCBA) – various types and sizes (for smartphone, notebook, power bank, and EV batteries)
  • Foam of different types and sizes (for smartphone, EV, and power bank batteries)
  • Silicon rings (for smartphone batteries)
  • Aluminium housings and plastic housings/top/bottom covers (for power bank and EV batteries)
  • Explosion-proof rubber covers (for EV batteries)
  • Holders, BMS brackets, silicone films/pads
  • Insulating strips, boxes, sheets, waterproof/breathable films
  • Module half shells, module protection sheets, light guide columns, lamp boards
  • Heat sinks, plastic shells for notebook batteries

All of the above were proposed for classification as parts of electric accumulators under CTH 8507 90 90.

3.2 Category B – Independent components

These are not treated by the assessee as “parts” of accumulators, but as individual electrical/electronic components, such as:

  • Li-ion cells (for EV and notebook batteries) – proposed under 8507 60 00
  • Printed Circuit Boards (bare PCB) – under 8534 00 00
  • Capacitors (multilayer ceramic capacitors) – under 8532 24 00
  • Diodes – under 8541 10 00
  • NTC thermistors – under 8533 40 30
  • Resistors (wire-wound variable resistors/rheostats ≤ 20W) – under 8533 31 20
  • Flexible Printed Circuit Boards (FPCB) – under 8534 00 00
  • Integrated Circuits – under 8542 31 00
  • MOSFETs – under 8541 29 00
  • PTC thermistors – under 8533 40 30
  • Nickel plates – under 7506 20 00
  • Connectors – under 8536 90 90
  • Solder paste – under 3810 10 10
  • Solder wire – under 8311 30 10
  • Fuses – under 8536 10 60
  • Fuse brackets – under 8538 90 00
  • Copper rows/switch copper bars – under 7407 10 30

3.3 Category C – Ancillary items

These include cables, adhesives, screws, labels, rubber pads, handles, plates, and similar support materials, proposed to be classified under their respective functional headings (e.g., 8544, 3506, 7318, 4821, 4016, etc.).

The ruling primarily focuses on Category A (classification as parts of CTH 8507) and validates/analyses the independent classifications in Category B.

4.1 General Rules for Interpretation (GRI)

The assessee relied on the General Rules for the Interpretation of the Schedule (GRI), which are aligned with the WCO Harmonized System Rules. Key reliance was placed on:

  • GRI Rule 1 – goods must be classified according to the terms of the headings and any relevant Section or Chapter Notes.