Supreme Court Issues Notice To IndiGo On Plea Of Customs Dept & GST Council Against Ruling On IGST Exemption For Imported Parts

The Supreme Court on Monday sought a response from IndiGo's parent company, InterGlobe Aviation, on a petition filed by the Customs Department challenging a Delhi High Court ruling that exempted the airline from paying Integrated Goods and Services Tax (IGST) on imported aircraft parts that were repaired and serviced abroad.

A Bench comprising Justice BV Nagarathna and Justice R Mahadevan issued notice to InterGlobe Aviation while hearing the department's plea against the March 2024 judgment of the Delhi High Court, which had quashed a portion of a customs notification that mandated IGST payment on the import of repaired aircraft engines and components.

Along with the Customs Department, Union Government, GST Council and the Central Board of Indirect Taxes and Customs are the other petitioners.

The petitioners, represented by Additional Solicitor General N. Venkataraman, argued before the Supreme Court that the High Court's decision had the effect of nullifying an independent fiscal levy under the GST regime, which Parliament had specifically enacted through the IGST Act.

The High Court had held that such a levy violated Section 25(1) of the Customs Act, 1962, which empowers the government to grant exemptions in public interest, and had accordingly extended the IGST exemption to aviation imports covered under Entry 77 of Notification No. 50/2017-Customs.

The High Court bench of Justice Yashwant Varma and Justice Ravinder Dudeja held that an additional levy of Integrated Goods and Services Tax (IGST) and cess under Section 3(7) of the Customs Tariff Act, 1975 on re-import of aircraft parts that were repaired abroad, is unconstitutional.

The High Court observed that “additional duty even after the transaction has been subjected to the imposition of a tax treating it to be a supply of service would be clearly unconstitutional and cannot be sustained.”

The Court also set aside a 2021 notification issued by the Central Board of Indirect Taxes & Customs (CBIC), which imposed an 'integrated tax and cess' under CTA, besides the customs duty.

 Case : Principal Commissioner of Customs Acc (Import) and others v. Interglobe Aviation Ltd | Diary No. 49140-2025