The India-UK trade agreement envisages an initial duty of 75 per cent on imports of eligible Scotch whisky, with the rate falling to 40 per cent over 10 years. Entries at serial numbers 827 and 830 of Table I to notification No. 29/2026-Cus dated July 14, 2026, give effect to the initial concession. Both entries say “All goods” against tariff items 22083012 and 22083092 and prescribe 25 per cent basic Customs duty (BCD) and 50 per cent Agriculture Infrastructure and Development Cess (AIDC), subject to the conditions in the notification, including those relating to origin.
The case of the Directorate of Revenue Intelligence (DRI) appears to be that the items imported are concentrates or compound alcoholic preparations of a kind used for the manufacture of beverages. According to Reuters, the DRI, in a memo dated November 4, asked the Customs field formations to apply the higher rate to such goods. The investigators reportedly take the view that the concession applies to finished products such as bottled Scotch. The distinction to be made is between whisky as imported and an alcoholic preparation used to make a beverage. UK verification guidance recognises that Scotch whisky can be shipped in bulk at high strength and diluted before bottling.
In October, India and the UK cited Scotch whisky as an early success of their trade agreement. Their October 12 joint statement said it had already entered India at reduced tariffs, without giving particulars of the goods cleared. Incidentally, tariff item 21069051 entered the Customs Tariff on May 1, 2026, through the Finance Act, 2026, when tariff item 21069050 was split into 21069051 and 21069059. The new item for compound alcoholic preparations carries 150 per cent BCD. The July notification gives no concession against that entry.
Interestingly, the DGFT’s ITC (HS) import schedule gives the description against 22083092 as Scotch in containers holding more than two litres. The Customs Tariff gives the description “Scotch” against both 22083012 and 22083092 under the six-digit subheading 220830 for whiskies. The first item comes under “In containers holding 2 litres or less” and the second under “Other”. The word “Other” must be read at the same level as the preceding description relating to container size. So, Scotch whisky in containers holding more than two litres gets the same concession as Scotch whisky in smaller containers. If, however, the goods as imported answer to the description of compound alcoholic preparations under tariff item 21069051, Customs would be on firmer ground in denying the exemption.
Importers should, therefore, go by the actual wording of the exemption notification issued by the Ministry of Finance, read with the Customs tariff. The text of the trade agreement, government press releases and reports in the media may help them understand the concession but importers should satisfy themselves that the imported goods answer to the tariff description and meet the conditions of the exemption notification.
