IndiGo Moves Delhi HC Over Rs 900 Crore Refund Linked To Customs Duty On Reimports Of Aircraft Parts

IndiGo has moved the Delhi High Court seeking a refund of Rs 900 crore paid as customs duty on aircraft engines and parts re-imported after overseas repairs, sources told Republic Media Network. 

The airline argued that the duty amounts to unconstitutional double taxation since GST on repair services was already paid.

The case was listed before Justices Prathiba M Singh and Shail Jain, but Justice Jain recused herself because her son is an IndiGo pilot. It will now be placed before another Bench.

Also Read: Investing Paradigm Shift: Indian Household Wealth Surges 13% In FY25

IndiGo said it paid the duty under protest across 4,000+ bills of entry, despite earlier tribunal and High Court rulings that such re imports are a service under GST and cannot be taxed again as goods. Refunds were denied by customs authorities, and the matter is now pending before the Supreme Court.

Appearing for IndiGo, Advocate V Lakshmikumaran had said at the time of re-import of aircraft engines and parts after repairs, the Gurgaon-headquartered airline, which is credited for a nationwide aviation crisis, paid basic customs duty without dispute.

On the other hand, since repair constitutes a service, it also discharged Goods and Services Tax (GST) on a reverse charge basis.

The customs authorities went on and levyied customs duty again by treating the same transaction as import of goods.

According to IndiGo, the issue was settled by the customs tribunal, which maintained that the customs duty could not be levied again on re-imports post repairs.

The airlines step to move the Delhi HC comes when the market share leader in domestic air travel has been held accountable for flight cancellations and delays across key airports in India.