The Bombay High Court has temporarily halted recovery proceedings in a ₹170 crore (approximately $20.4 million USD) Goods and Services Tax (GST) dispute involving Gateway Terminals India Pvt Ltd, a key container terminal operator at Jawaharlal Nehru Port (JNPT). The stay, issued on February 4, 2026, prevents tax authorities from taking further action against the company even as the court considers its challenge to a denial of input tax credit (ITC).
The dispute centers on license fees paid by Gateway Terminals to JNPT, India’s busiest container port, for the right to operate a terminal under a 30-year agreement. Tax authorities rejected the company’s claim for ITC, arguing that the payments to JNPT did not constitute a “service” eligible for the credit under GST regulations. ITC allows businesses to offset taxes paid on inputs against their tax obligations on sales, and its denial can significantly increase operational costs, particularly for companies engaged in long-term infrastructure concessions.
Gateway Terminals, a joint venture between JNPT and Container Corporation of India, has contested this assessment, arguing that the tax department’s position is inconsistent. Abhishek A Rastogi, founder of Rastogi Chambers, representing Gateway Terminals, told the court that authorities were simultaneously denying ITC by classifying the transaction as non-service related, while also refusing a refund of taxes already paid on the same transaction. Rastogi argued this approach contradicted the principle of revenue neutrality.
Justices G S Kulkarni and Aarti Sathe of the Bombay High Court, in their interim order, directed the tax department to refrain from further recovery efforts until a hearing scheduled for March 4, 2026. The court has also requested a response from the government within three weeks, outlining its position on the matter.
Gateway Terminals operates container terminals at major ports and is part of a larger global port operations network, according to reports. The case is being closely watched by the logistics and infrastructure sectors, as the outcome could set a precedent for how GST liabilities are assessed and enforced in similar port and terminal operations. JNPT, established in 1989, currently handles around 50% of India’s total containerized cargo volume.
The denial of ITC and subsequent demand for recovery also includes interest and penalties, adding to the financial burden on Gateway Terminals. The core legal question before the court is whether the underlying transaction between Gateway Terminals and JNPT qualifies as a service under GST law, and whether the tax department can simultaneously deny both ITC and a refund for the same payment.