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.
EP04: India's Supreme Court's Judgement on Ocean
Freight
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
