Budget carrier SpiceJet is facing significant regulatory pressure as the Goods and Services Tax (GST) department has issued a demand of ₹124.65 crore for repeated failures to file statutory returns. This action comes under the Central Goods and Services Tax (CGST) Act and the State GST (SGST) Act, 2017, following months of non-compliance.
GST Department Initiates Action Against SpiceJet
According to GST officials, the airline has consistently delayed submitting its required tax returns. This persistent non-compliance has led to the tax demand and a formal show-cause notice proposing the cancellation of SpiceJet's GST registration. The notice for potential registration cancellation was issued on May 25, 2026.
Despite receiving the notice, SpiceJet has reportedly not yet submitted the outstanding GST returns. The substantial tax demand is the result of a provisional assessment conducted under Section 62 of the CGST and SGST Acts. This provision allows authorities to determine tax liability when a taxpayer fails to furnish returns after multiple reminders.
Details of the Outstanding Liabilities
The total demand of ₹124.65 crore spans several tax periods, with the largest liabilities identified in November and December, amounting to ₹44.44 crore and ₹43.79 crore, respectively. Additional demands include ₹12.19 crore for January, ₹12.10 crore for February, and ₹12.12 crore for March.
GST officials have warned that continued non-compliance could lead to further stringent actions under GST regulations. An official stated, "If SpiceJet does not promptly file its pending returns and comply with its statutory obligations under GST law, further action will be taken in accordance with the applicable rules."
Impact on SpiceJet Amidst Financial Challenges
This latest development adds another layer to SpiceJet's ongoing financial and regulatory challenges. The airline has been actively working to stabilize its operations and strengthen its financial position following a period marked by various legal, regulatory, and cash-flow issues. Cancellation of GST registration could present significant operational hurdles, potentially affecting tax credits, relationships with vendors, and overall compliance requirements for the business.
While companies are typically given an opportunity to respond to such notices and rectify defaults before final action is taken, the current proceedings represent a critical regulatory challenge for SpiceJet as it navigates a highly competitive aviation market and strives for operational continuity.
SpiceJet officials could not be reached for comment regarding the GST demand and cancellation notice.