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September 2022

Critical Analysis

By Sunil Gabhawalla | Rishabh Singhvi | Parth Shah
Chartered Accountants
Reading Time 23 mins
A recent decision of the Supreme Court in All India Haj Umrah Tour Organizer Association Mumbai vs. UOI1 (‘AIHUTO’ case) did not prima-facie seem to unsettle legal positions framed over the history of indirect tax legislation. Probably, the limited macro scope failed to generate enough traction for the decision to be scrutinised further. Yet, a more critical analysis of the decision would suggest a missed opportunity to decide on certain basic tax principles which could have resolved fundamental issues of the law. To appreciate this viewpoint, we may delve into the details and respectfully examine the missed pointers.

BACKGROUND

The issue cropped up on account of a tax exemption being granted to Haj pilgrims who availed services through the ‘State Run Haj committees’ and hence having a visible saving compared to the services being offered by Private Tour Operators (HGOs/PTOs). The simple grievance of the PTOs was that they are being discriminated against despite all the services provided by Haj Committees and PTOs being identical. The PTOs approached the Courts on this matter and were rightly directed to the GST council for making appropriate representations on such policy matters, which was rejected by the GST council based on the recommendation of the Fitment committee. Petitions were filed by PTOs before the Apex Court challenging the said decision.

CASE SUMMARY
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