Supreme Court seeks IndiGo’s reply on Customs plea over IGST on aircraft parts re-imported for repairs
New Delhi: The Supreme Court (SC) on Monday sought a response from IndiGo on a petition filed by the Customs Department over whether Integrated Goods and Services Tax (IGST) should be levied on aircraft components re-imported into India after being sent abroad for maintenance, according to a report by LiveLaw.
A bench comprising Justices B V Nagarathna and R Mahadevan issued a notice to IndiGo after hearing the Customs Department’s plea.
The case reached the apex court after the department challenged a Delhi High Court (HC) ruling from March that struck down a part of a 2021 Customs notification mandating the payment of IGST and cess on such re-imported goods.
Along with the Customs Department, the Union government, the GST Council, and the Central Board of Indirect Taxes and Customs (CBIC) are also petitioners in the matter.
“An important constitutional question has arisen in this matter. The judgment hurts us—it declares the law unconstitutional and affects every re-import,” said Additional Solicitor General N Venkataraman, appearing for the Customs Department.
Counsel representing InterGlobe Aviation, the parent company of IndiGo, told the SC that the airline is still awaiting refunds despite the HC order and that officials have declined to comply with the ruling.
“Our refunds are all getting stuck now. They are refusing to abide by the Delhi High Court’s order,” the counsel said.
The dispute centres on whether repair costs of goods re-imported into India after maintenance abroad should attract IGST.
The SC’s ruling in this case could have wide-ranging implications for the aviation industry and the broader interpretation of GST laws on re-imported goods.
The IndiGo IGST dispute
In 2021, the CBIC issued a notification requiring airlines to pay IGST and cess on aircraft components re-imported after overseas repairs.
IndiGo challenged the directive in the Delhi HC, arguing that the parts had already been taxed during export or repair, and levying IGST again amounted to double taxation.
In March 2024, the HC ruled in IndiGo’s favour, declaring parts of the notification unconstitutional and beyond the government’s powers.
It cited Section 25(1) of the Customs Act, 1962, to uphold exemptions granted in the public interest.
The Customs Department and GST Council have now moved the Supreme Court to contest this verdict.
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