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Supreme Court sets aside Saudi Airlines penalty over foreign travel tax delay
The case concerns an appeal by Saudi Arabian Airlines against a High Court judgment that upheld penalties and interest imposed by the Union of India for delayed payment and short payment of Foreign Travel Tax (FTT).
The core issue is whether a mere delay in depositing the tax constitutes a 'failure to pay' that attracts mandatory penalties under Section 38(3) of the Finance Act, 1979.
Who it concerns: Petitioner/Appellant: M/s. Saudi Arabian Airlines; Respondents: Union of India & Ors.; Bench: Justice Ujjal Bhuyan.
What the court decided
- The Supreme Court set aside the penalty imposed on Saudi Arabian Airlines.
- The Court held that mere delay in depositing Foreign Travel Tax is not the same as 'failure to pay' under Section 38(3) of the Finance Act, 1979.
- The Court reversed the High Court's dismissal of the writ petition filed by the airline.
Also in the document
- The judgment is marked as 'REPORTABLE' in the provided text.
- The underlying dispute involved delays ranging from 1 day to 63 days in depositing tax, with the airline arguing these were technical rather than deliberate failures.
- The High Court had previously held that delay in payment amounts to failure to pay, a view the Supreme Court's title and operative outcome contradict.
How this was written
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The original document
Supreme Court of India — orders & judgments
Court order · 1 Sep 2026
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