People familiar with the deliberations told ET that after the legal review Mohit Mineral The decision of the matter is over and the proposal to remove the tax will be taken to the council. An official quoted above said, “Both the Law Committee of the Law Ministry and the GST Council are of the view that IGST on sea freight should be abolished as per the Supreme Court judgment.”
This will be part of the agenda of the GST Council for the upcoming meeting, the official said.
Another senior official confirmed, “The proposal is ready and will be discussed in the next GST Council meeting as the decision to levy IGST was taken by the council.”
The GST Council is the apex decision making body for indirect taxes. A draft circular will also be submitted to the Council and once approved will be circulated. The council meeting is scheduled to be held in Madurai next month.
Experts said the move is likely to provide much-needed relief to importers whose refund claims of over ₹1,000 crore are stuck.
Abhishek Rastogi, partner, Khaitan & Co, representing the importers in Mohit, said, “The importers should get their due after the Supreme Court order. There is still no clarity in this regard and formal communication will help in releasing the funds. ” Mineral matter.
In May, a bench of justices D Y ChandrachudSurya Kant and Vikram Nath dismissed the central government’s appeal against an earlier judgment of the Gujarat High Court, which held that IGST on sea freight is unconstitutional.
In its judgment, the SC bench also said that the central and state governments have powers to make laws on GST and the council should work in a cohesive manner to achieve a workable solution.
Following that decision, the Center said it would take a legal opinion on the decision.
The Gujarat High Court on July 29 directed the Central Board of Indirect Taxes and Customs to refund the IGST paid on sea freight along with interest within six weeks. However, no formal instructions have been given to the officials in this regard.