Brand New MiG Jet Stuck At Goa Port, Customs Duty Not Paid

New Delhi: For nine days, a brand new MiG-29K fighter plane acquired from Russia has been standing at the Goa port.

It will not go anywhere for now, say sources, unless the defence ministry pays over Rs 160 crore in customs duty.

At airports and ports across the country, there is a growing collection of overhauled aircraft engines and military equipment worth crores.

This year, the government said that the military will no longer be spared from customs duty for imports. The idea was to provide a level playing field to Indian defence manufacturers.

But, in an apparent oversight, the finance ministry's blanket order withdrawing duty exemption for all military hardware imports has brought all equipment belonging to the services in the tax net.
 Top sources told NDTV that apart from the MiG-29K that arrived from Russia on May 2, overhauled engines and spares of Mirage 2000 and overhauled engines of transporters like the Russian made IL- 76 are lying at various airports and ports.

NDTV has accessed a letter from the Indian Air Force to the Customs and Excise department on April 27 requesting a duty write-off for gear boxes of the Russian made Mi-26 aircraft that have been brought to India after an overhaul. The equipment is "bonafide property of the Government of India," and "needs to exempt from Customs duty," the letter says.

The Army, Air Force and Navy face a peculiar problem - although the customs duty will go the government, there is no provision for it in the defence ministry's budget.

Besides customs duty, according to rough estimates, the ministry also has to pay about Rs 35 lakh per day to store the costly equipment in the warehouses of airports and ports.

Calling the matter 'teething trouble," the Defence ministry said it will get the budget to pay for the customs duty. All the equipment stuck at the customs will be cleared in the next two to three days, the ministry said.