The Bombay High Court has dominated in favour of Vodafone Idea Limited, directing the Income Tax division to refund Rs. 1,128 crore paid by the telecom big for the evaluation yr 2016-2017. The court docket deemed the evaluation order handed in August this yr as “time-barred” and criticised the assessing officer for “laxity and lethargy,” inflicting a considerable loss to the exchequer. The judgment underscored the officer’s negligence, stating it has repercussions on the nation’s financial stability.Â
Vodafone Idea’s petition highlighted the surplus tax cost, describing the case as “quite elementary.” The court docket advisable an intensive investigation into the assessing officer’s failure to adhere to the Income Tax Act and urged strict motion in opposition to these accountable, with the order copy circulated to the Union Ministry of Finance.
The authorized saga started when the assessing officer issued a draft order in December 2019, prompting Vodafone Idea to file objections earlier than the Dispute Resolution Panel (DRP) in January 2020. The DRP issued instructions in March 2021. Vodafone Idea argued that the ultimate order, mandated inside 30 days, was not handed by the officer, justifying its entitlement to a refund with curiosity. The firm filed a petition within the Bombay High Court in June 2023, main to the assessing officer’s last evaluation order in August.
The Income Tax division claimed non-receipt of DRP’s instructions due to the “Faceless Assessment Regime.” However, the court docket rejected this, asserting that DRP’s instructions had been accessible on the Income Tax Business Application (ITBA) portal. The court docket questioned the assessing officer’s inactivity for 2 years and emphasised that the August 31, 2023 evaluation order, issued two years after DRP’s instructions, was time-barred and unsustainable.
The Bombay High Court’s verdict not solely secures a considerable refund for Vodafone Idea Limited but in addition raises issues in regards to the effectivity and transparency of the tax administration system. The court docket’s suggestion for an in depth inquiry and strict motion underscores the potential penalties of bureaucratic negligence on the nationwide exchequer. The resolution serves as a reminder of the vital function officers play in upholding the legislation and guaranteeing the correct functioning of economic techniques.
