SC upholds Rs 1,600 crore tax refund for Vodafone Idea, dismisses SLP
New Delhi, Jan 20, 2025
The court dismissed the SLP on grounds of delay, refusing to condone the same
The Supreme Court on Monday upheld a Bombay High Court order directing the Revenue Department to refund Rs 1,128 crore to Vodafone Idea Limited, along with interest, bringing the total refund to Rs 1,600 crore.
A division bench of Justices JB Pardiwala and R Mahadevan dismissed the Revenue Department's special leave petition (SLP) challenging the Bombay High Court ruling. The court refused to condone a delay of 295 days in filing the SLP, stating that the delay had not been satisfactorily explained.
“There is a gross delay of 295 days in filing the special leave petition that has not been satisfactorily explained,” the court noted.
The Bombay High Court had earlier allowed Vodafone Idea's writ petition, accepting the company's returned income since the order under Section 143(3) read with Section 144C(13) of the Income Tax Act was barred by limitation as of April 30, 2021.
The High Court directed the Income Tax Department to refund Rs 1,128 crore paid by Vodafone Idea for the assessment year 2016-2017, along with Rs 500 crore in interest. The assessment order passed by the department in August 2023 was deemed time-barred and therefore unsustainable.
A division bench of Justices KR Shriram and Neela Gokhale, in their November 2023 judgment, criticised the assessing officer for failing to pass the final order within the mandated 30-day period. The court highlighted the officer’s laxity and negligence, which it said caused significant loss to the exchequer and the public.
“The case of Vodafone was elementary, and we are constrained to observe the complete apathy and negligent approach of the assessing officer in discharging his duties under the Income Tax Act. Such dereliction affects the exchequer and has far-reaching consequences on the nation’s economic stability,” the High Court stated.
Vodafone Idea had argued that the assessing officer should have passed the final order within the stipulated 30 days under the Act. The company claimed entitlement to a refund with interest due to the officer’s failure to do so.
Senior Advocate Sachit Jolly, along with Advocate Soumya Singh, represented Vodafone Idea in the case.
[The Business Standard]
