DGFT issues notification to restrict import of computers, laptops, tablets and servers

This Tax Alert summarizes the recent notification [1]  issued by by the Directorate General of Foreign Trade (DGFT) restricting import of computers, laptops, tablets, servers etc.

As per the notification, import of laptops, tablets, all-in-one personal computers, ultra small form factor computers and servers falling under HSN 8741 shall be 'Restricted' and their import would be allowed against a valid license for restricted imports.

However, the said restriction does not apply in the following cases:

•  Import under Baggage Rules, 2016

• Import of one such item (except server), including those purchased from e-commerce portals, through post or courier

• Import up to 20 such items per consignment for specified purposes subject to the condition that such goods shall be used only for the stated purposes and will not be sold. Further, after the intended purpose, the goods would either be destroyed beyond use or re-exported

• Re-import of goods repaired abroad

• Such items are an essential part of capital goods

The notification is effective from 3 August 2023.

Comment:

It would be relevant to analyse whether this restriction would also apply to imports made by Special Economic Zone and Export Oriented Units (EOUs). Clarification from the Government in this regard would help industry. Further, the businesses may need to evaluate the impact of this notification where the goods are in-transit or arrived at port but not yet cleared. 

[1] Notification No. 23/2023 dated 3 August 2023