Ministry of Finance Clarifies Solar Safeguard Duty Assessment Tariff Code

After Madras High Court order, all imports under heading 8541 have been assessed provisionally


The Ministry of Finance has issued a new memorandum clarifying that only goods specifically classified under tariff item 8541 40 11 (solar cells whether or not assembled in modules or panels) will be subject to the safeguard duty.

Recent confusion arose as the earlier notification No. 1/2018-Customs (SG), issued on July 30, 2018 said that “solar cells whether or not assembled in modules or panels”  falling under heading 8541 or tariff item 8541 40 11 of the first schedule to the Customs Tariff Act, 1975 will attract the safeguard duty.

There are many items, other than solar cells and modules, that are classified under heading 8541 in the customs tariff act, such as: diodes, transistors and similar semiconductor devices, photosensitive semiconductor devices, including photovoltaic cells, whether or not assembled in modules or made up into panels, light emitting diodes (led), and mounted piezoelectric crystals.

After the imposition of the safeguard duty, the port systems were detecting any bill of entry filed under heading 8541 and sending it to the accessing officer to check the levy of the safeguard duty on that item. This was creating confusion, as other commodities were also sent for evaluation.

Therefore, the department of revenue, under the Ministry of Finance, circulated a memorandum clarifying that since the goods are specifically classified under tariff item 8541 40 11, only this tariff item should be subject to system intervention and sent for safeguard evaluation.

Currently, all these goods are being accessed provisionally following the instruction of Madras High Court.

Mercom reported earlier that the Madras High Court had instructed customs officials at the Chennai port to provisionally release a module shipment without paying the safeguard duty. The court had asked customs authorities to make a provisional assessment of the safeguard duty payable in the event of upholding the notification and company to furnish a bond.

Recently, the Ministry of Finance had announced the levy of a 25 percent safeguard duty based on the final recommendations proposed by the DGTR. The decision, which caught the industry off guard, was then challenged by solar developers filing a petition at Orissa High Court.

In the latest development, the Orissa High Court fixed September 19, 2018 as the next date of hearing for the case. This means the safeguard duty imposition will be on hold until that date.

Nitin is a staff reporter at and writes on renewable energy and related sectors. Prior to Mercom, Nitin has worked for CNN IBN, India News, Agricultural Spectrum and Bureaucracy Today. He received his bachelor’s degree in Journalism & Communication from Manipal Institute of Communication at Manipal University and Master’s degree in International Relations from Jindal School of International Affairs. More articles from Nitin Kabeer