A-1 Cuisines Private Limited Vs Union of India (Bombay High Court)
Bombay High Court dismissed the petition filed by A1 Cuisines Private Limited seeking a writ of mandamus to exempt their proposed retail shop at Nagpur Airport’s Domestic Security Hold Area from GST on sales to international passengers. The petitioner argued that similar sales at duty-free shops in international airports are exempt from GST and customs duties, and their store should receive the same benefit. They also sought the right to claim refunds on input tax paid. The petitioner relied on previous judgments, particularly Hotel Ashoka v. Assistant Commissioner of Commercial Taxes (2012) and Commissioner, Service Tax-VII v. Flemingo Duty Free Shop Pvt. Ltd. (2017), which held that sales at duty-free shops after immigration clearance occur outside Indian tax jurisdiction. However, the court found these precedents inapplicable, as they pertained to international terminals beyond customs frontiers, whereas the petitioner’s proposed shop was in a domestic airport area.
The court emphasized that the distinction between international duty-free shops and domestic airport retail spaces is crucial under GST laws. Sales at duty-free shops in international terminals occur beyond Indian customs territory and are considered exports, making them non-taxable. However, sales at domestic airports, even if made to passengers traveling internationally via a transit airport, do not meet the same criteria. The court further noted that customs authorities lack the ability to verify whether goods purchased at domestic airports are taken abroad. Based on these findings, the court ruled that the petitioner’s claim lacked merit and dismissed the petition, affirming that GST applies to sales made in domestic airport areas.
