SC Dismisses IGST Demand on Aircraft Repairs Done Abroad

The tax demand was based on a 2021 notification that sought to retrospectively amend a 2017 exemption

- Krishna Yadav

In a relief for airlines such as IndiGo and SpiceJet, the Supreme Court (SC) on Monday dismissed a plea by the customs department seeking to impose integrated goods and services tax (IGST) on re-imported aircraft and parts sent overseas for repairs.

The tax demand was based on a 2021 government notification that sought to clarify and retrospectively amend a 2017 exemption.

Under the original 2017 notification, airlines were required to pay only basic customs duty (BCD) on the cost of repairs, freight and insurance when re-importing aircraft parts after overseas maintenance.