On Tuesday, the Supreme Court of India dismissed a slew of petitions seeking GST exemption for Haj and Umrah services provided to pilgrims travelling to Saudi Arabia. The petitions were filed by several private tour operators who provide services to the pilgrims travelling to Mecca.
Supreme Court pronounces judgment in a batch of petitions filed by various private tour operators seeking exemption from the Goods and Service Tax for Haj and Umrah services offered by them to pilgrims travelling to Saudi Arabia#SupremeCourt pic.twitter.com/eXleJvFDs8
— Bar & Bench (@barandbench) July 26, 2022
According to the reports, the Supreme Court delivered the verdict stating that the services mentioned by the petitioners were already eligible for the exemption granted to religious activities. However, the subject of whether a tax would be levied on extraterritorial operations, as stated in Article 245 of the Constitution, has not been resolved and remains open.
The travel companies had contested the imposition of GST on Haj pilgrims who use services provided by registered private tour operators, arguing that no tax legislation may apply to extraterritorial activities under Article 245 of the Constitution.
They had placed the argument that services consumed outside of India should not be subject to GST. They further claimed that the charge is discriminatory since it exempts those pilgrims who go through the Haj Committee of India.
The bench headed by Justice AM Khanwilkar said, “We have dismissed all petitions on both grounds of exemption and discrimination. Other issue of extra-territorial operation is kept pending. That hasn’t been decided”.
