The Supreme Court has dismissed an appeal by the Airports Authority of India (AAI), upholding a service tax demand of £8.59 crore. This tax relates to fees collected from airlines, cargo operators, and exporters between 2003 and 2007 for services like terminal handling and security screening. The court agreed with tax authorities that these services were taxable under 'airport services' and 'storage and warehousing', rather than being exempt as direct export services.
In a setback for the Airports Authority of India (AAI), the Supreme Court on Tuesday upheld a service tax demand of Rs 8.59 crore on fees collected by the airport regulator from airlines, cargo operators and exporters between2003 and 2007.
A two-judge bench, comprising Justices Pankaj Mithal and Pr
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FAQ :
The Supreme Court has upheld a service tax demand of £8.59 crore.
The service tax demand is against the Airports Authority of India (AAI).
The demand covers fees collected by the AAI between October 2003 and March 2007.
The taxed services include terminal handling, X-ray screening, packing, and loading for export cargo, as well as cargo handling and security checks.
The AAI argued that it acted in good faith as a public authority and that the fees should be exempt as part of export cargo handling.
The Supreme Court upheld the tax authorities' interpretation, stating that the services rendered were taxable under 'airport services' and 'storage and warehousing', and not exempt export services.