Sections 25A explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sections 25A and 25B give the Central Government power to exempt from duty goods that cross the border only for repair, further processing or manufacture and then return. Section 25A covers goods imported and re-exported (inward processing); section 25B covers goods exported and re-imported (outward processing). Each has the same three conditions, including a one-year limit.
This article follows the text on the CBIC portal updated to 30 March 2022 (the Act as amended up to the Finance Act, 2022). Please check any later Finance Act changes to these sections before acting.
The Central Government may, by notification, exempt goods imported for repair, further processing or manufacture from the whole or part of duty if they are re-exported within one year of the clearance order and are identifiable in the export goods. Section 25B does the mirror image for goods exported for repair, processing or manufacture and re-imported within one year, notwithstanding section 20. Both sections were inserted by the Finance Act, 2018.
Section 25A: inward processing
Where the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification, exempt such of the goods which are imported for the purposes of repair, further processing or manufacture, as may be specified in the notification, from the whole or any part of duty of customs leviable thereon, subject to the following conditions:
- (a) the goods shall be re-exported after such repair, further processing or manufacture, as the case may be, within a period of one year from the date on which the order for clearance of the imported goods is made;
- (b) the imported goods are identifiable in the export goods; and
- (c) such other conditions as may be specified in that notification.
The footnote shows the section was inserted by section 62 of the Finance Act, 2018 (13 of 2018) with effect from 29 March 2018.
Notice what the section does and does not do. It does not itself exempt anything. It gives the Government the power to exempt goods "as may be specified" in a notification, and the notification decides which goods and adds its own conditions under clause (c). The clock in clause (a) starts on the date the order for clearance of the imported goods is made, and the goods must be re-exported within one year of that date. Clause (b) means the imported goods must be identifiable in what is exported: the exporter should be able to show, in the finished or repaired item, the goods that came in.
If you plan an import for repair or processing under such a notification, you will need your Import Export Code in place first; our IEC registration service can help with that.
Section 25B: outward processing
The section begins "Notwithstanding anything contained in section 20". Where the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification, exempt such of the goods which are re-imported after being exported for the purposes of repair, further processing or manufacture, as may be specified therein, from the whole or any part of duty of customs leviable thereon, subject to these conditions:
- (a) the goods shall be re-imported into India after such repair, further processing or manufacture, as the case may be, within a period of one year from the date on which the order permitting clearance for export is made;
- (b) the exported goods are identifiable in the re-imported goods; and
- (c) such other conditions as may be specified in that notification.
The footnote shows that section 25B was also inserted by section 62 of the Finance Act, 2018 with effect from 29 March 2018.
The opening words matter. Section 20 says that goods imported after exportation are liable to duty and to the conditions and restrictions that apply to goods of like kind and value. Section 25B overrides that for goods covered by a notification and meeting the conditions: relief can be given even though section 20 would otherwise apply. Our article on sections 19 to 21 explains section 20.
The two sections compared
| Point | Section 25A (inward) | Section 25B (outward) |
|---|---|---|
| Direction | Imported first, re-exported later | Exported first, re-imported later |
| Purpose | Repair, further processing or manufacture | Repair, further processing or manufacture |
| Instrument | Notification specifying the goods | Notification specifying the goods |
| Time limit | Re-export within one year from the order for clearance of the imported goods | Re-import within one year from the order permitting clearance for export |
| Identification | Imported goods identifiable in the export goods | Exported goods identifiable in the re-imported goods |
| Other conditions | As specified in the notification | As specified in the notification |
| Relationship with section 20 | Not stated | Operates notwithstanding section 20 |
Practical points to check
- The notification. Neither section lists goods, rates or documents. Before moving goods, read the notification that applies and note any condition under clause (c).
- The start date of the one-year clock. For 25A it is the date of the order for clearance of the imported goods; for 25B it is the date of the order permitting clearance for export. Keep copies of both orders.
- Identification. The text requires identifiability but does not say how it is proved. Records that link the incoming item to the outgoing item (serial numbers, batch records, repair job sheets) are the obvious way to meet the requirement, though the notification may specify its own method.
- Extension. The text of these two sections prints no power to extend the one-year period. Do not assume an extension; check the notification.
- Exemption scope. The text speaks of "the whole or any part of duty", so the notification decides how much is exempt.
For general guidance on clearance paperwork, see our posts on the import clearance process and the export clearance process. The general exemption power is in section 25; our article on section 25 explains it.
A worked example with invented names
Deccan Precision Tools Pvt. Ltd. has a customer in another country who sends a machine part to India for repair. A notification under section 25A exempts goods of that description, with the usual conditions. The part is cleared on a bill of entry; the order for clearance is made on a particular date. Deccan repairs the part and re-exports it within one year from that date, and its job sheet and serial number show the part is identifiable in the export. Conditions (a) and (b) are met; any other condition in the notification must be met too. In the other direction, Deccan itself sends a gear unit abroad for outward processing and brings it back within one year from the date of the order permitting clearance for export, with serial numbers linking the two. Section 25B is the route, again subject to the notification, and it works notwithstanding section 20.
Need help with repair or processing imports?
Moving goods across the border for repair or processing needs the right registration before the first shipment. Our IEC registration team can help you set that up so that you can claim a notified exemption when it applies.
Key takeaways
- Sections 25A and 25B only give power to exempt; the notification names the goods and may add conditions.
- Inward processing needs re-export within one year of the clearance order, with the imported goods identifiable in the export goods.
- Outward processing needs re-import within one year of the order permitting clearance for export, with the exported goods identifiable in the re-imported goods.
- Section 25B operates notwithstanding section 20.
- Both sections were inserted by the Finance Act, 2018, with effect from 29 March 2018 as the footnotes print.
Read next
- Section 25: power to grant exemption from duty
- Sections 19–21: sets of articles, re-importation and derelict or wrecked goods
- Sections 26–26A: refund of export duty and import duty in certain cases
- Customs Clearance Process for Exports
Disclaimer: Based on the Customs Act, 1962 as published on the CBIC Tax Information Portal, updated to 30 March 2022 (amended up to the Finance Act, 2022), as consulted on 2 October 2026. Finance Acts of 2023 and later, and the current rules, regulations and notifications, should be checked. This article is general information, not legal advice; check the official text before acting.