Judge recuses herself as IndiGo moves Delhi HC for refund of ₹900 cr customs duty

Delhi high court judge Shail Jain on Friday recused herself from hearing IndiGo’s petition seeking a refund of over ₹900 crore in customs duty paid on aircraft engines and parts re-imported into India after being repaired abroad.
The matter was listed before a bench of justices Prathiba M Singh and Shail Jain, justice Jain recused from hearing since her son works as a pilot in IndiGo.
“List before a bench of which one of us (justice Shail Jain) is not a member, subject to orders of the Chief Justice,” the court said in its order.
The matter will now come up before another bench, likely on December 19.
IndiGo’s lawyer V Lakshmikumaran, submitted that the airline had paid basic customs duty without dispute when its aircraft engines and parts were re-imported after repairs.
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Additionally, because the repair activity amounted to a service, it also discharged GST under the reverse charge mechanism. However, the customs authorities allegedly treated the same transaction as an import of goods and sought to levy customs duty once again.
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The lawyer further added that though the customs tribunal by way of its ruling had previously held that charging customs duty again on such re-imports was unconstitutional, the customs authority allegedly compelled IndiGo to pay the duty amounting to over ₹900 crore to secure clearance of aircraft engines and other critical components.
He further added that when his client filed refund claims, customs authorities refused on the ground that the airline must first seek reassessment of each bill of entry. He added that though it made repeated representations, including to the Principal Commissioner, no reassessment orders had been passed.
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The petition comes at a time when the airline is facing a major disruption in its operations. The unprecedented meltdown has triggered thousands of flight cancellations and chaos across major airports.
IndiGo, which commands over 60% of India’s domestic aviation market, has cited a convergence of crises — pilot shortages, cascading delays from an Airbus A320 software advisory, the enforcement of new Flight Duty Time Limitations (FTDL) fatigue rules and an aggressive winter schedule since October 26.
The new FDTL norms, designed to enhance pilot rest and reduce night operations, forced hundreds of pilots into mandatory downtime after cumulative delays from the previous weekend violated midnight cut-offs. The airline’s high-utilisation model collapsed without staffing buffers.
Amid the ongoing crisis, the government has suspended the new pilot rest norms temporarily, imposed airfare caps to prevent price escalation and deployed additional trains to move stranded travellers.
On Tuesday, the civil aviation ministry observed that IndiGo had been unable to operate its winter and summer schedules efficiently and therefore directed the airline to cut its operations by 10% across all sectors.
Aviation minister Ram Mohan Naidu said the reduction was necessary to stabilise the airline’s functioning and help bring down the number of cancellations.
The high court on Wednesday had criticised Centre and the Directorate General of Civil Aviation (DGCA) for not acting promptly against IndiGo over its failure to deploy sufficient manpower to meet the new FDTL norms that recently resulted in lakhs of passengers being stranded at airports nationwide due to mass flight cancellations.