The Bombay High Court has directed the Income Tax department to refund Rs 1,128 crore to Vodafone Idea Limited, citing the department's "time-barred" assessment order for the assessment year 2016-2017. In its judgment, the court criticized the assessing officer for "laxity and lethargy" in not issuing the final order within the mandated 30-day period, causing a significant loss to the exchequer.
The ruling came in response to a petition by Vodafone Idea Limited, asserting that the tax paid exceeded the legitimate amount due. The court expressed concern over the officer's apathy and recommended a detailed inquiry, advocating strict action against those responsible for the delay. Emphasizing the impact on the nation's economic stability, the court directed the order copy to be circulated to the Union Ministry of Finance. The company argued that, under the Income Tax Act, it was entitled to a refund with interest due to the officer's failure to issue the final order within the specified timeframe.
The court rejected the tax department's claim of not receiving the Dispute Resolution Panel's directions, stating they were accessible on the Income Tax Business Application portal. Consequently, the court deemed the assessment order passed in August 2023 as time-barred and ruled in favor of Vodafone Idea Limited, granting the refund with interest.