New Delhi, Sept 28 (KNN) The Finance Ministry notified changes to the IGST Act with regard to payment of integrated GST on 'ocean freight' on imported goods with effect from October 1.

It has exempted payments made for goods imported through ocean freight from 5 per cent integrated GST with effect from October 1, reported Business standard.

At present, importers are required to pay 5 per cent GST under the Reverse Charge Mechanism.

Giving its ruling in the Mohit Minerals case, the Supreme Court in May last year had held that since the Indian importer is liable to pay IGST on the 'composite supply', comprising of supply of goods and supply of services of transportation, insurance, etc in a CIF (Cost Insurance Freight) contract, a separate levy on the Indian importer for the 'supply of services' by the shipping line would be in violation of the GST Act.

In the Mohit Minerals case, the company challenged the validity of the CBIC notification regarding the levy of IGST on ocean freight in the Gujarat High Court. The Supreme Court upheld the decision of the High Court.  (KNN Bureau)