Kanika Tekriwal, co-founder and CEO, JetSetGo | Photo Credit: Shedrick Pelt

Last week, JetSetGo, the country’s largest operator of private jets and helicopter fleets, became the first Indian company to directly import an aircraft (Hawker 800 XP) in 74 years, and was leased through IFSC, GIFT City. The transaction follows Finance Minister Nirmala Sitharaman’s announcement during the Union Budget that a tax holiday will be offered for capital gains of aircraft leasing companies that set up their subsidiary in GIFT City, Ahmedabad and tax exemption for aircraft lease rentals paid to foreign lessors who set up their enterprise in India.

JetSetGo’s co-founder and CEO, Kanika Tekriwal tells us how her company was able to carry out this transaction:

The major challenge faced during the leasing process was getting the aircraft’s custom clearance since this is the first time an aircraft was being cleared by an Indian company. The process is long. The aircraft being imported into India needs to be filed under SEZ as an import and while leasing the aircraft to any NSOP, a Bill of Entry is to be filed. The process takes 7-8 hours after the aircraft arrives. Custom duty taxes have to be paid through the online system of SEZ with the payment directly going to RBI. The RBI then sends confirmation to custom authorities, this delays the process by 3-4 hours.

Since the transaction was unique for custom authorities, making them understand it was a challenge. It took us two days to work on this with them after clearing the first part of the process.

Further after the generation of two Bills of Entry (one inward and one outward), the next challenge we faced was for payment. The payment has to go into the account number generated online by RBI which itself is unique to a transaction, so you can’t add this beforehand. The account number is unique and of 30 digits. Many times, banks don’t support a large account number, but we finally were able to make the payment via another bank. Since custom authorities can’t leave the aircraft without payment of customs, the entire process was a time consuming, tedious and challenging one. The DC of Mihan and the customs team should be lauded for making the transaction successful .

(As told to KGiriprakash)

Published on August 22, 2021