An NCR-based firm that imported oxygen cylinders & regulators from abroad and thereafter donated them to the Delhi Government has challenged the Centre’s decision of excluding the aforesaid imports from the Adhoc GST exemption that is meant for COVID-19 relief material.
Delhi HC Shall Hear the Writ Petition on Thursday Against
- The Finance Ministry of the Central Government
- The GST Council and
- Finance Department of the Delhi Government
Presently:
- Oxygen regulators imported from abroad are subject to 5% IGST and
- Cylinders and the rakes for carrying the above-mentioned regulators are subject to 18% GST
Recently, last week, a bench of the High Court held that the 12% iGST that is levied on oxygen concentrators imported from abroad for personal use is ‘unconstitutional’. In response, the Finance Ministry had told the Court that the issue would be placed before the 43rd GST Council Meeting 
On May 3, the Ministry had taken the decision to exempt imported COVID relief material from IGST given that:
- It was received free and
- Is donated to the entities that are approved by the state for free distribution.
The below-mentioned State government, recently, had granted the relaxation related to Covid-19 Imports:
- On May 1, The Gujarat government had notified that the GST leviable on critical COVID-19 imports shall be reimbursed to those domestic entities which are importing material for the purpose of free donation
- On May 17, the Haryana Government announced a similar scheme of GST refund
- Apart from the Gujarat and Haryana Government, several other states have permitted GST exemption on the COVID-related supplies
The petition filed by an individual has stated that the aforesaid levying of tax defeats the purpose of One Nation One Tax.
Arguing that there is an absence of ‘no intelligible’ difference between the efforts of the firm to import oxygen cylinders or any other ‘authorized person’ doing so, the petition emphasized that the benefit in both the cases flow to the government for aiding common people and the circumstances for getting the exception are onerous and arbitrary’.
The May 3 notification of the government that granted exemption related to IGST to state governments and authorized entities called for ‘public policy under ‘exceptional circumstances and there is no reasoning as to why this cannot be applied to corporate entities importing these items for donating to states said Mr. Abhishek A Rastogi, the partner at Khaitan & Co.
“In this moment of crisis, levying IGST on such imports by the petitioner as against exempted imports for Government and other bodies is in stark violation of Article 14 of the Constitution. This also deprives the right to life of the individuals under Article 21 of the Constitution, the petition states.”
The petition further argued that the GST council has been unsuccessful to perform its constitutional responsibilities which include making recommendations to the Union and the states regarding any specific rates for a particular period during natural calamity or disaster for the purpose of raising additional resources.
