Apex Court asks I-T department to refund Rs 733 crore to Vodafone Idea

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On Wednesday, the Apex Court gave partial relief to Vodafone Idea Ltd by asking the income tax (I-T) department to refund Rs 733 crore to the telecom firm within 4 weeks, for the assessment year 2014-15.

Vodafone Idea, formerly known as Vodafone Mobile Services Ltd, had however sought Rs 4,759.07 crore in tax refund from for AYs – 2014-15, 2015-16, 2016-17 & 2017-18.

The Supreme Court didn’t order I-T refund pertaining to AYs other than 2014-15.
“So far 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 Crores; while for AY 2015-16 there is a demand of Rs.582 Crores,” a bench comprising Justice U U Lalit & Justice Vineet Saran said in the Judgement.

The Apex Court also noted that the Income 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.

SC said that “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 bench also ordered the Tax department to conclude as early as possible the proceedings relating to the demand of refund of the telecom firm & the scrutiny of income by the Income Tax department with respect to assessment years 2016-17 & 2017-18.

The Judgement said that “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”.

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Vodafone had earlier moved the High Court of Delhi claiming that there was complete inaction on part of I-T department in processing its ITRs & in issuing appropriate refund to it.

The firm had sought a direction to the government department to process & grant refunds for the AYs 2014-15 to 2017-18, along with interest under Section 244A of the Act.

The High Court of Delhi on Dec 14, 2018, dismissed the plea & against that decision an appeal was filed in the Supreme Court.

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Read Judgement here: