Singapore Airlines filed eight refund claims totalling Rs 45,92,528 for flights canceled between Oct 2019 and Mar 2021 because of the Covid‑19 pandemic. The airline had returned both the fare and GST to passengers, but could not offset the credit against its output tax. The case reached the GST Appellate Tribunal after the joint commissioner rejected the claims.
The GSTAT found that the airline had provided sufficient evidence of direct refunds to passengers, preventing any tax incidence on the cancellations. This evidence satisfied the tribunal’s requirement for a 'sufficient' proof.
Citing the Supreme Court’s guidance that canceled tickets should not leave customers with tax costs, the tribunal ruled that Singapore Airlines is entitled to full GST refunds. The decision also underscored that the tax paid on canceled flights must be returned to the consumer. The ruling reinforces the principle that GST should not become a cost when a transaction is voided.
The tribunal ordered the revenue department to process the refund within two weeks, including interest. The judgment sets a clear precedent for other airlines grappling with pandemic‑related cancellations.