In re Zydus Healthcare Limited (CAAR Mumbai)
Summary: M/s Zydus Healthcare Limited, IEC No. 0389057274, filed applications for advance ruling before the Customs Authority for Advance Rulings, Mumbai, seeking clarification on the IGST rate applicable to imported bulk drugs or Active Pharmaceutical Ingredients (APIs). The applications were received on 28.04.2026 under Section 28H(1) of the Customs Act, 1962. The applicant sought a ruling on whether IGST was leviable at 5% under Sl. No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate) dated 17.09.2025 and, if not, the appropriate IGST rate for bulk drugs falling under Chapters 28 or 29 of the Customs Tariff Act, 1975.
The applicant stated that it is a pharmaceutical company engaged in manufacturing and supplying pharmaceutical products and that it purchases and imports a wide range of bulk drugs, which are Active Pharmaceutical Ingredients used in the manufacture of pharmaceutical formulations and, occasionally, for testing, clinical research and bioequivalence studies. The bulk drugs are generally classified under Chapters 28 or 29 as organic or inorganic chemicals.
The applicant relied upon Sl. No. 226 of Schedule I to Notification No. 9/2025-Integrated Tax (Rate), which covers “All Drugs and medicines including their salts and esters and diagnostic test kits; formulations manufactured from bulk drugs”, subject to the exclusion of drugs or medicines covered by Sl. No. 113 of Notification No. 10/2025-Integrated Tax (Rate) dated 17.09.2025. The applicant submitted that its products were not covered by Annexure I to Notification No. 10/2025 and therefore should attract IGST at 5%.
