M/S. Irc Agrochemicals PVT. LTD vs. Union Of INDIA & Ors
Held
The Court held that the issue involved in the writ petition is directly covered by the Supreme Court's decision dated 19th May, 2022, in the case of Union of India & Anr. vs. M/s. Mohit Minerals Pvt. Ltd., and the Division Bench of the High Court's decision dated 15th June, 2022, in the case of Union of India & Anr. vs. MCPI Private Limited & Anr. (MAT 151 of 2021). Consequently, the Court declared that no tax is leviable under the Integrated Goods and Services Tax Act, 2017, on the nature of service involved in this writ petition. The ratio decidendi is that ocean freight for services provided to a person in a non-taxable territory for transportation of goods from outside India to the customs station of clearance in India is not taxable under the IGST Act, 2017, as per the Supreme Court and High Court precedents. All legal consequences flowing from this declaration are to follow.
Facts
The petitioner, M/s. IRC Agrochemicals Pvt. Limited, filed a writ petition challenging the levy of Integrated Goods and Services Tax (IGST) under the IGST Act, 2017. The dispute concerns taxability on ocean freight for services provided to a person in a non-taxable territory, specifically for the transportation of goods by vessel from outside India to the customs station of clearance in India. Both the petitioner and the respondents (Union of India and others) jointly submitted that the issue was covered by previous judgments. The tax period is not explicitly stated.
Key Issues
1. Whether tax is leviable under the Integrated Goods and Services Tax Act, 2017, on ocean freight for services provided for a person located in a non-taxable territory by way of transportation of goods by a vessel from a place outside India up to the customs station of clearance in India. Petitioner's contention: The petitioner argued that tax is not leviable on such ocean freight, relying on the Supreme Court's decision in Union of India & Anr. vs. M/s. Mohit Minerals Pvt. Ltd. and a Division Bench decision of the High Court in Union of India & Anr. vs. MCPI Private Limited & Anr. (MAT 151 of 2021). Revenue's contention: The revenue (respondents) also jointly submitted that the issue is covered by the aforementioned judgments, implying agreement with the petitioner's stance.
Sections Cited
Integrated Goods and Services Tax Act, 2017
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WPA 23665 OF 2019
2022
Sl no. 13
M/s. IRC Agrochemicals Pvt. Limited Ct no. 2
- Vs - P.M.
Union of India & Ors.
Mr. Rahul Tangri,
Mr. Dipankar Majumdar
… for the petitioner
Mr. Vipul Kundalia,
Mr. Bhaskar Prosad Banerjee
…. for respondent CGST & CX
Mr. Bhaskar Prosad Banerjee
… for Customs authority
Mr. Vipul Kundalia,
Mr. Partha Ghosh,
Mr. Tapan Bhanja
… for Union of India
Heard learned Advocates appearing for both parties.
It is recorded that both parties at the outset jointly submits that the issue involved in this writ petition is directly covered by a decision of this Court dated 17th June, 2022 in the case of M/s. Emami Agrotech Limited & Anr. – Vs – Union of India & Ors. in WPA 6941 of 2018. In this writ petition, the subject matter of challenge is as to whether tax is leviable under the Integrated Goods and Services Tax Act, 2017, on ocean freight, for services provided for a person located in a non-taxable territory by way of
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