Bombay HC Quashes Service Tax on Ocean Freight for Importers

Sanathan Textile Pvt Ltd. Vs Union of India (Bombay High Court)

The Bombay High Court has declared as illegal and unconstitutional the practice of levying service tax and Integrated Goods and Services Tax (IGST) on ocean freight for goods imported under a Cost, Insurance, and Freight (CIF) contract. The court’s decision was delivered in the case of Sanathan Textile Pvt. Ltd. vs. Union of India, where the petitioner challenged the validity of various notifications that imposed this tax liability on Indian importers through a reverse charge mechanism.

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