Important Keywords: Instruction No. 01/2025 – GST, IGST exemption airlines, foreign airline tax India, Notification 08/2024 Integrated Tax Rate, MoCA bilateral agreement, Finodha GST help,
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F. No. 190341/12/2025-TRU
Government of India
Ministry of Finance
Department of Revenue
(Tax Research Unit)
North Block, New Delhi
Dated the 31.01.2025
Information received from Ministry of Civil Aviation (MoCA) with respect to Gazette notification No. 08/2024 – Integrated Tax (Rate) dated 08.10.2024 notified by Department of Revenue.
To,
The Principal Chief Commissioners/ Chief Commissioners/ Principal Commissioners/ Commissioners of Central Tax (All) / The Principal Director Generals/ Director Generals (All)
Madam/Sir,
Subject: Information received from Ministry of Civil Aviation (MoCA) with respect to Gazette notification No. 08/2024 – Integrated Tax (Rate) dated08.10.2024 notified by Department of Revenue- reg.
The undersigned is directed to refer to O.M. dated 20.01.2025 (copy enclosed)from Ministry of Civil Aviation (MoCA) providing information in respect of Gazette notification No. 08/2024 – Integrated Tax (Rate) dated 08.10.2024 notified by Department of Revenue.
2.I t may be recalled that based on recommendations of the 54th GST Council meeting held on 09.09.2024 import of services by an establishment of a foreign airlines company from a related person or any of its establishment outside India, when made without consideration was exempted subject to following conditions:
- Provided that GST at applicable rates is paid by the establishment of the foreign airline company in India on transport of goods and passengers as may be applicable;
- Provided that Ministry of Civil Aviation certifies that the establishment of the foreign company in India is that of an airline company which has been designated by the foreign government under the applicable bilateral air services agreement with India;
- Provided further that, Ministry of Civil Aviation certifies that on a reciprocal basis, designated Indian airlines are not subject to levy of similar taxes by whatever name called for the same services appearing under the entry, by the Government of the country designating the foreign airline company.
3. The second and third conditions, reproduced above relate to MoCA. With respect to second condition MoCA has provided a list of designated foreign airlines that are currently operating from India as per ongoing Winter 2024-25 schedule [Annexure I of the O.M].
3.1 With respect to third condition, MoCA has informed that the matter was discussed with Indian carriers operating international services and comments received from the Indian carriers namely, Air India, IndiGo and Akasa Air have also been shared [Annexure II to the O.M.].
4. The O.M. received from MoCA along with the relevant Annexures is being placed on the CBIC website for information of the field formations.
Encl: As above
Yours faithfully,
Smita Roy
Technical officer TRU-II
📘 Frequently Asked Questions (FAQs) on Instruction No. 01/2025-GST
Q1: What is the essence of Instruction No. 01/2025-GST?
Answer:
The instruction clarifies the implementation of Notification No. 08/2024 – Integrated Tax (Rate) dated 08.10.2024. It provides IGST exemption on import of services by foreign airline companies from related establishments outside India, if done without consideration and under strict conditions certified by the Ministry of Civil Aviation (MoCA).
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Q2: Which services qualify for this exemption?
Answer:
This applies to “import of services” by a foreign airline’s Indian establishment from its related party abroad (like parent company, overseas branches), provided the services are rendered without consideration and the specified conditions are met.
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Q3: What are the key conditions for claiming IGST exemption?
Answer:
✅ GST must be paid on domestic passenger and goods transportation in India.
✅ MoCA must certify the Indian establishment is that of a designated foreign airline under an official bilateral Air Services Agreement.
✅ MoCA must certify that designated Indian airlines are not taxed similarly in the foreign airline’s home country (reciprocal tax treatment).
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Q4: What is MoCA’s role in this context?
Answer:
MoCA is responsible for issuing two key certifications:
✈️ One confirming the airline’s designation under a bilateral agreement
🌍 One verifying that Indian airlines are not subject to equivalent foreign taxes, ensuring reciprocity
MoCA’s certification is mandatory for the exemption to apply.
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Q5: Has MoCA shared any actionable lists with CBIC?
Answer:
Yes.
📋 Annexure I: List of designated foreign airlines operating in India under the Winter 2024-25 schedule.
🛫 Annexure II: Comments from Indian airlines (Air India, IndiGo, Akasa) affirming reciprocal tax treatment by foreign nations.
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Q6: Is this exemption applicable where services are received with consideration?
Answer:
❌ No. The exemption is strictly limited to services received without consideration. If any payment is involved, IGST shall apply as per normal provisions under the IGST Act.
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Q7: What happens if the conditions are not met?
Answer:
If any of the conditions—GST payment in India, MoCA certification, or reciprocity—are not fulfilled:
🚫 The exemption under Notification No. 08/2024 is not available.
📄 The services would then be liable to tax under the reverse charge mechanism in accordance with IGST rules.
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Q8: How does this impact designated foreign airlines operating in India?
Answer:
It provides significant cost savings for foreign airlines operating in India by exempting IGST on internal support services received from overseas offices—if compliance is ensured. It also encourages bilateral tax parity in civil aviation.
Need help with compliance? Finodha has you covered: https://finodha.in/gst-compliance/
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Q9: How can Indian businesses or airline agents use this instruction?
Answer:
✈️ Airline representatives should coordinate with MoCA to secure the required certifications.
📋 Documentation must be maintained to prove services are received without consideration.
💼 GST filings must clearly mention IGST exemption reference and CBIC instruction.
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Q10: Can Finodha assist with aviation GST and customs compliance?
Answer:
Yes. Finodha provides:
🔍 Guidance on interpreting MoCA & CBIC instructions
📄 IGST exemption claim support
🧾 GST return filing: https://finodha.in/gst-return-filing/
📁 ROC and Company setup for airline branches: https://finodha.in/private-limited-company/
🔐 Digital Signature for DGFT & customs filings: https://finodha.in/online-dsc-digital-signature-certificate/
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✅ Conclusion:
Instruction No. 01/2025 – GST and Notification 08/2024 – Integrated Tax (Rate) offer a vital tax benefit to foreign airlines, provided MoCA certification and bilateral reciprocity are in place. Businesses must ensure full compliance to leverage this exemption.
📢 For GST compliance, aviation tax strategies, or MoCA documentation, consult Finodha today.
Download PDF: Instruction No. 01/2025 – GST
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