New Delhi: The Supreme Court in relief for airlines, such as Indigo and Spicejet, rejected the customs department’s action on Monday, which sought to store integrated goods and services (IGST) on the re -imported aircraft and parts sent overseas for repairs. Demand for tax was based on the Government of 2021, which tried to clarify and retrospectively change the liberation since 2017.
According to the original announcement of 2017, airlines were obliged to pay only the basic customs duties (BCD) for the costs of repair, transport and insurance when importing parts of the aircraft after overseas maintenance. In 2021, the government explained that IGST was also applicable to the value and transport of repair – and tried to use it retrospectively for past imports.
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The bench composed of justice BV Nagarathn and KV Viswanathan refused to admit the dismissal of the Customs Department against August 5, 2024, which decided on the Customs and Tax Appeals of the Tribunal (Travel). The Tribunal rejected a retrospective tax demand and decided to have another burden on airlines.
“I have no problem with release … civil appeal was rejected,” said Lavička.
During the hearing, the next general lawyer (ASG) N. Venkataraman, who appeared for the customs ward, claimed that almost almost almost £There was 100 crore in the stake.
“This is a high tax, £100 crore … I need this appeal to be accepted, ”he said.
ASG also stated that the interpretation of the 2017 announcement is already under the challenge of the Supreme Court. He argued that although the clarification of 2021 was affected for being retrospective, IGST could still be imposed on the basis of a 2017 notice, which he claimed had already included such a tax under the sentence of “customs duties”.
“If we succeed in interpreting the 2017 announcement, these 1,800 input laws will be automatically covered. Even if the 2021 announcement is reduced for being retrospective, our case will survive because of the 2017 notice.
However, the court rejected the argument and noted: “You cannot do this with a retrospective amendment… If the announcement of 2017 did not cover IGST, you cannot use notification 2021 to retrospectively.”
“1,800 accounts” refers to the entry-import laws a statement filed by airlines with customs authorities for each shipment of aircraft or aircraft re-imported after repairs abroad.
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Since July 2024, India has imposed a unified IGST rate of 5% for all imports of components of aircraft, engine parts and MRO (maintenance, repair and repair).
Igst line tracking
The dispute arose after the introduction of the tax from the goods and services (GST) on 1 July 2017. Before the GST airlines sent parts or engines abroad for repairs of BCD and compensation obligations (CVD) only for repair costs, costs of repair, transport and insurance costs – not full value.
Post-GST, notification No. 45/2017-Customs (of 30 June 2017) continued in this structure of liberation. This required the payment of “duty” for repair costs plus insurance and costs, but did not mention IGST. Airlines such as Indigo and Spicejet interpreted it as liberation from IGST and paid only BCDs.
However, the customs authorities claimed that Igst’s “obligation” included IgST in GST regime and since August 2017 began to increase IGST payment requirements for such re-iMports. Airlines have attacked these requirements before traveling.
In November 2020, he decided to travel in favor of airlines and decided that IGST was not due according to the announcement of 2017 because it was not explicitly included.
The government then questioned this decision at the Supreme Court, which admitted the appeal of the customs department. This case remains waiting.
After the Supreme Court allowed the Customs Department to dismiss, the government issued notifications of Nice 36/2021 on July 19, 2021, changing the earlier announcement of IGST and compensation and the insertion that it was always intended. Customs then tried to retrospectively select IGST for the period from 1 July 2017 to 18 July 2021 on the basis of this amendment.
This step was again questioned by airlines before traveling, which in August 2024 decided in its favor and hit a retrospective tax demand. This decision of the journey was the subject of Monday’s release by the Supreme Court.
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Indigo independently also questioned the constitutionality of the announcement of 2021 itself before the High Court in Delhi.
On 4 March 2025, the High Court ruled in favor of the airlines and declared the unconstitutional part of the announcement of 2021, which tried to save IGST and stop the costs of repairing goods again imported to India after overseas maintenance.
This decision has not yet been attacked by the customs of the Supreme Court.
(Tagstotranslate) Supreme Court IGST decision
