The next hearing is expected again on December 19.
Judge Withdraws from IndiGo’s INR 900 Crore Customs Duty Case in Delhi HC
India’s largest airline, Indigo, has filed a petition in the Delhi High Court seeking the refund of more than INR 900 crore in customs duty that it paid on aircraft engines and parts re-imported into India after undergoing repairs abroad.
On Friday, the case was listed before a Division Bench comprising Justice Prathiba M. Singh and Justice Shail Jain. However, Justice Jain recused herself from hearing the matter, stating a potential conflict of interest since her son is employed as a pilot with IndiGo. The court subsequently ordered that the matter be relisted before a bench of which Justice Jain is not a member, subject to directions from the Chief Justice. The next hearing is expected again on December 19.
In court, IndiGo’s counsel V. Lakshmikumaran argued that the airline had duly paid basic customs duty when engines and parts were re-imported after repair, and had also discharged GST under the reverse charge mechanism because the repair activity qualified as a service. However, he said customs authorities treated the re-imports as fresh imports of goods and demanded additional duty, leading to the disputed levy of more than INR 900 crore.
The lawyer told the court that a customs tribunal had previously held that imposing customs duty again on such re-imports was unconstitutional, but customs officials nonetheless compelled IndiGo to pay the duty to secure clearance of critical aircraft components, the report mentioned.
When IndiGo later sought refunds, the customs authorities rejected the claims and stated that the airline should first seek reassessment of each of the more than 4,000 bills of entry. Despite repeated representations, including to the Principal Commissioner, no reassessment orders have been passed so far.
The petition comes amid a period of operational stress for IndiGo, which has faced widespread cancellations and management challenges, though the refund case itself focuses strictly on tax and customs law.
Source: Hindustan Times
