In a partial relief to Vodafone Idea, the Supreme Court on Wednesday directed the Income Tax department to refund Rs 733 crore within four weeks. Vodafone Idea, formerly known as Vodafone Mobile Services, had appealed for tax refund of Rs 4,759.07 crore for assessment year (AY) 2014-15, 2015-16, 2016-17 and 2017-18.
Dismissing Vodafone Idea's appeal for refunding its total claim, the apex court asked the Income Tax department to refund the amount within four weeks.
"Insofar as AY 2014-15 is concerned, final assessment order passed under Section 143(3) of the (Income Tax) Act indicates that the appellant (telecom firm) is entitled to refund of Rs 733 crore; while for AY 2015-16 there is a demand of Rs 582 crore," a bench comprising Justices U U Lalit and Vineet Saran said in the judgement.
The bench noted that the Tax department would be entitled to invoke requisite power under Section 245 of the Act to set off the amount of refund payable in respect of AY 2014-15 against tax remaining payable.
"Since the requisite action is not even initiated, we say nothing in that respect. In the premises, we direct that the amount of Rs.733 Crores shall be refunded to the appellant (telecom firm) within four weeks from today subject to any proceedings that the Revenue may deem appropriate to initiate in accordance with law," the top court said.
The court asked the I-T department to conclude as early as possible the proceedings relating to the demand of refund of the telecom firm and the scrutiny of income by the I-T department with respect to assessment years 2016-17 and 2017-18.
"Except for the directions as indicated, we see no merit in any of the contentions advanced by the appellant (Vodafone). This appeal is, therefore, dismissed without any order as to costs," the judgement said.
Vodafone Idea, a joint venture between Vodafone Group and Aditya Birla Group, alleged that the I-T department did not process their tax returns from 2014-15 to 2017-18. The telco had sought a direction to Tax department to process refunds for the AYs 2014-15 to 2017-18, along with interest under Section 244A of the Act.
Last week, UK-based telecom major Vodafone Group plc has infused Rs 1,530 crore (or $200 million) into Vodafone Idea to support managing operations amid the coronavirus crisis. The payment will also help Vodafone Idea pay statutory dues to the government.
By Chitranjan Kumar with PTI inputs
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