ARTICLE
10 June 2025

Tax Podcast - EP04: India's Supreme Court's Judgement On Ocean Freight

Nexdigm UAE

Contributor

Professional Services that help companies navigate challenges across all stages of their life-cycle. Through our direct operations in the USA, Poland, UAE, and India, we serve a diverse range of clients, spanning multinationals, listed companies, privately-owned companies, and family-owned businesses from over 50 countries. Nexdigm is an employee-owned, privately held, independent global organization that helps companies across geographies meet the needs of a dynamic business environment. Our focus on problem-solving, supported by our multifunctional expertise enables us to provide customized solutions for our clients.
Under India GST Law, importer in India was required to discharge GST under reverse charge on deemed value of ocean freight services under any CIF (i.e. Cost, Insurance and Freight) contract of import.
India Tax

Under India GST Law, importer in India was required to discharge GST under reverse charge on deemed value of ocean freight services under any CIF (i.e. Cost, Insurance and Freight) contract of import. The trade and industry challenged this levy and argued that since value of ocean freight services is already a part of assessable value of imported goods for the purpose of discharging customs duty and IGST on import, it will result into double taxation.

Recently, the Supreme Court of India, has given rest to this long-drawn issue and pronounced landmark judgment in the case of Union of India vs M/s. Mohit Minerals. It has been held that levy of IGST under reverse charge on ocean freight services would vitiate the concept of 'composite levy' and go against the whole scheme of GST and hence, the appeal of the revenue was dismissed. In effect, the decision of the High Court, wherein the notifications, which provided for levy of IGST, were held to be un-constitutional, has been upheld.

Originally published 15 June 2022.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More