InterGlobe Aviation carries Rs 2,400 crore IGST recoverable

InterGlobe Aviation Limited, referred to as InterGlobe Aviation, carried Rs 2,400 crore of Integrated Goods and Services Tax, or IGST, payments under protest as recoverable at 30 September 2026. The balance included Rs 106.8 crore paid during the September 2026 quarter on the re-import of repaired aircraft, engines and certain aircraft parts.

Why did InterGlobe Aviation pay IGST under protest?

InterGlobe Aviation paid IGST under protest to Customs authorities on the re-import of repaired aircraft, aircraft engines and certain aircraft parts. The company said the Rs 106.8 crore paid in the quarter ended 30 September 2026 brought its cumulative payment under protest to Rs 2,400 crore.

InterGlobe Aviation disputes that IGST is payable when these items return to India after repair abroad. It said appeals against the Rs 2,400 crore have been filed, or will be filed, before appellate authorities, rather than treating the payments as an accepted tax liability.

The quarter's Rs 106.8 crore payment was an addition to the disputed balance, not a recovery or settlement. At 30 September 2026, InterGlobe Aviation continued to show the entire Rs 2,400 crore as recoverable, based on its legal position and the status of related proceedings.

How did the September payment change the disputed balance?

The Rs 106.8 crore paid during the quarter ended 30 September 2026 increased the cumulative disputed amount to Rs 2,400 crore. InterGlobe Aviation did not disclose the cumulative amount at the preceding quarter-end, but identified the September-quarter payment as part of the total carried as recoverable.

The disclosure covers re-imports of three categories: repaired aircraft, aircraft engines and certain aircraft parts. InterGlobe Aviation's accounting treatment applies to the cumulative Rs 2,400 crore paid under protest through 30 September 2026, irrespective of whether an appeal has already been filed or is yet to be filed.

The reported balance is therefore different from a provision for a potential tax cost. InterGlobe Aviation stated that the Rs 2,400 crore is shown as recoverable because it continues to believe IGST is not payable on the specified repaired items when they are re-imported.

What rulings support InterGlobe Aviation's IGST position?

InterGlobe Aviation received three favourable orders from the Customs, Excise and Service Tax Appellate Tribunal, or CESTAT, New Delhi, relating to IGST paid on imports before 19 July 2021. The Customs authorities appealed these orders, but the Supreme Court dismissed one departmental appeal on 14 July 2025.

The Supreme Court subsequently dismissed the department's review petition in that same matter on 17 February 2026. Two other departmental appeals against favourable CESTAT orders remained pending before the Supreme Court at 30 September 2026, and InterGlobe Aviation said no stay had been granted on those CESTAT orders.

The pre-19 July 2021 cases are distinct from the later dispute over a government amendment notification. That date marks the notification that amended an earlier Customs exemption notification to reiterate the government's position that IGST applies on the re-import of goods after repair.

What is the dispute over the July 2021 notification?

InterGlobe Aviation challenged the constitutional validity of the 19 July 2021 amendment notification through a writ petition before the High Court of Delhi. The notification reiterated the government's view that IGST applies when repaired goods are re-imported into India.

In March 2025, the High Court of Delhi held that a repair and re-import transaction is a supply of service. According to InterGlobe Aviation's disclosure, the court also held that imposing IGST upon re-import of items repaired abroad was unconstitutional and invalid.

The department filed an appeal against that High Court order before the Supreme Court on 29 August 2025. The appeal was pending at 30 September 2026, and InterGlobe Aviation said the Supreme Court had not granted a stay on the High Court judgment.

Why is the Rs 2,400 crore recorded as recoverable?

InterGlobe Aviation records the Rs 2,400 crore paid through 30 September 2026 as recoverable because it relies on the favourable Supreme Court and High Court developments and advice from legal counsel. Management's stated view is that IGST remains not payable on re-imports of repaired aircraft, engines and certain parts.

This accounting treatment means the Rs 2,400 crore is not presented as a final expense arising from the re-import tax dispute. It reflects InterGlobe Aviation's expectation of recovery or adjustment if its legal position is sustained through the pending appellate processes.

The company did not provide a timetable for the recovery of the Rs 2,400 crore. Its 29 October 2026 results instead identified three unresolved routes: appeals against individual payments, two pending departmental appeals from CESTAT orders, and the department's appeal against the March 2025 High Court decision.

How does the IGST dispute compare with other tax disclosures?

InterGlobe Aviation separately disclosed income-tax exposure of Rs 2,418.5 crore, excluding interest and penalty, for tax disallowances through Assessment Year, or AY, 2022-23 if manufacturer incentives are held taxable. That conditional income-tax exposure is Rs 18.5 crore higher than the Rs 2,400 crore of IGST paid under protest, but the matters concern different taxes and legal proceedings.

The Rs 2,418.5 crore income-tax exposure is net of Rs 533.2 crore of minimum alternate tax recoverable written off in earlier years. InterGlobe Aviation also said the matter could affect carried-forward losses with a tax effect of Rs 1,822.7 crore, while it has recorded no provision based on legal advice and favourable Income Tax Appellate Tribunal orders.

InterGlobe Aviation's income-tax litigation has favourable tribunal orders for AY 2012-13 and certain years through AY 2015-16, while tax-authority appeals remain before the High Court of Delhi. Unlike the IGST balance, the Rs 2,418.5 crore is a disclosed exposure contingent on incentives being held taxable rather than an amount already paid under protest.

Conclusion

InterGlobe Aviation's Rs 2,400 crore recoverable balance at 30 September 2026 represents IGST already paid under protest, including Rs 106.8 crore during the quarter. The company's treatment rests on one dismissed Supreme Court departmental appeal, the dismissed review petition, favourable CESTAT orders and the March 2025 High Court ruling.

The next developments are the two remaining departmental CESTAT appeals and the 29 August 2025 appeal against the High Court order, both before the Supreme Court. InterGlobe Aviation disclosed that no stay had been granted in either litigation stream at 30 September 2026, while additional payments or appellate filings could alter the reported recoverable amount.