In a setback to Vodafone Idea, the Supreme Court (SC) Wednesday rejected the telco’s plea, asking the Income Tax (I-T) Department to process and deposit tax refunds worth Rs 4,759.7 crore. The apex court said the authorities were justified in holding back refunds until tax returns of the company was perused by the authorities.
The SC, however, asked the I-T department to take a decision on the pending tax refunds as soon as possible.
I-T department authorities have kept tax refunds of the company between assessment year (AY) 2012 and 2017, in abeyance, claiming that the returns of the company for these years was “under scrutiny” and since a notice had been issued to the company contending the returns they had filed, the refund need not be processed immediately. The said tax refunds between AY2012 and 2017 has been withheld by authorities for various reasons, such as transfer pricing adjustment, capitalisation of license fees, 3G spectrum fees, and asset restoration obligation including the effects of amalgamation of group entities.
Vodafone Idea had sought tax refunds of Rs 4,759.7 crore from the I-T department, claiming that its tax returns between AY 2012 and 2017 had not been processed by the authorities despite repeated reminders on the same. Though the SC directed I-T to process Vodafone Idea’s tax refunds worth Rs 733 crore for AY2014-15 within four weeks, the relief could be short lived. The department had raised additional tax demand of Rs 582 crore for AY2015-16, which is stuck in litigation.
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