Cancelled Flight? GST Can Be Reclaimed If Tax Is Refunded To Passenger
What Happened
The GST Appellate Tribunal has ruled that airlines can claim a refund of GST paid on cancelled tickets if they return both the fare and GST to passengers and provide supporting evidence. The ruling came in a case involving Singapore Airlines’ eight refund claims totalling ₹45.92 lakh. The tribunal directed the tax department to process the airline’s refund claims within two weeks, along with applicable interest, after finding sufficient evidence that passengers had received the refunds.
Key Takeaways
The ruling clarifies that GST need not remain a cost for an airline when a ticket is cancelled and the entire fare, including GST, has been returned to the passenger, provided adequate documentation exists.