Delhi HC Sets 5% IGST Rate on the Import of Dialysis Machines

The Delhi High Court has awarded relief of as low as 5% Integrated Goods and Service Tax (IGST) towards importing dialysis machines by Fresenius Medical Care India Private Limited (FMC India).

Dialysis machines covered under HSN Codes 9018 and 9031 are exposed to be taxed at 5%, essentially awarding a significant rebate of 7% on the import of dialysis machines, the bench of Justice Sanjeev Sachdeva and Justice Ravinder Dudeja witnessed.

The applicant/taxpayer, FMC, is the Indian subsidiary of the global leader in the production, marketing, and distribution of quality dialysis and renal medical equipment.

Towards the uncertainty of the correct Integrated Goods and Services Tax (IGST) rates applicable to “dialysis machines” and “dialysers,” FMC sought clarifications as to the IGST rates on importing dialysis machines.

The applicant asked for a recommendation via the respondent department to explain that the IGST rate applicable to the applicant for importing dialysis machines is 5% as per HSN code 90189031 for the office memorandum on October 13, 2023.

The department, dialysis machines covered under HSN code 90189031 are accountable to be taxed at 5% for the notification on October 13, 2023. A 5% IGST rate is applicable for “artificial kidney” and “disposable sterilized dialyzer” (serial No. 254-55, respectively).

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“Insofar as the case of the petitioner is concerned, subject to verification of the HSN code, the same would be subject to tax at 5% in terms of said notification,” the court expressed during disposing of the petition.