HC Orders Tax Refund of Rs 1,128 Crore to Vodafone Idea; Pulls Up I-T Dept for Laxity and Lethargy – News18

The Bombay High Court has directed the Income Tax division to refund Rs 1,128 crore to Vodafone Idea Limited paid by the telecom operator in taxes for the evaluation 12 months 2016-2017. The evaluation order handed by the division in August this 12 months was time-barred and therefore can’t be sustained, the HC famous in its judgement on Wednesday.

A division bench of Justices Ok R Shriram and Neela Gokhale additionally took a powerful view towards the assessing officer for exhibiting laxity and lethargy in not passing the ultimate order throughout the mandated 30-day time and thus inflicting an enormous loss to the exchequer and public. The courtroom handed its judgment on a petition filed by the Vodafone Idea Limited claiming the I-T division failed to refund the quantity paid by it for the evaluation 12 months 2016-2017 which, it stated, was in extra of the official tax due on its earnings.

The bench in its order famous the case of Vodafone was fairly elementary and that it was constrained to observe the entire apathy and negligent method of the assessing officer involved in discharging his duties in accordance with provisions of the Income Tax Act. Any dereliction and remissness on the half of the officers entrusted with an obligation to act throughout the strict contours of legislation impacts the exchequer and has far reaching penalties on the prosperity and financial stability of the nation, the order stated.

Laxity on this regard has a propensity to destroy and deliver to naught any efficient system put in place by the federal government for environment friendly and clear administration of taxation legal guidelines and its rules, it added. The courtroom beneficial an in depth enquiry to be initiated on the failure on half of the assessing officer involved to act in accordance with provisions of the Income Tax Act.

Strict motion ought to be taken towards individuals accountable for the laxity and lethargy displayed which has induced an enormous loss to the exchequer and in flip to the residents of this nation, the HC stated, directing for its order copy to be circulated to the Union Ministry of Finance. As per the petition, the assessing officer handed a draft order pertaining to the evaluation 12 months in December 2019 towards which the corporate filed objections earlier than the Dispute Resolution Panel (DRP) in January 2020.

In March 2021, the DRP issued sure instructions. The Vodafone Idea Limited in its plea stated the assessing officer ought to have handed the ultimate order within the case inside 30 days as mandated within the Act. Since the officer failed to cross the ultimate order, it was entitled to a refund with curiosity, the corporate stated. The firm additionally stated after it filed the petition in HC in June 2023 searching for refund of the quantity, the assessing officer handed the ultimate evaluation order in August.

The tax division claimed due to the “Faceless Assessment Regime” it had not obtained the DRP’s instructions. The excessive courtroom, nevertheless, refused to settle for this and stated the DRP instructions have been at all times seen and accessible on the Income Tax Business Application (ITBA) portal. There was additionally no whisper of any rationalization as to why the assessing officer remained inactive and silent for two lengthy years within the case and swung into motion solely when he obtained info of the petition filed, it stated.

We don’t have any hesitation in holding that the evaluation order dated August 31, 2023 handed by the assessing officer two years after the DRP instructions, is time barred and can’t be sustained, the bench stated. Hence, the Vodafone Idea Limited was entitled to obtain the refund along with curiosity, the HC stated.

(This story has not been edited by News18 workers and is printed from a syndicated information company feed – PTI)