Delhi HC raps I-T dept over Rs 53 crore Vodafone Idea refund delay

New Delhi: Coming down heavily on the income tax department for holding back ₹53.09 crore refund for over two years, the Delhi High Court has asked it to refund the amount to Vodafone Idea (Vi) with interest for assessment years 2003-04 (Apr-Mar) and 2008-09 to 2013-14 by September 30, failing which the amount shall carry an additional interest of 1% per month over and above the statutory interest.

Observing that the case portrays a "grim picture of the state of affairs prevailing in the department" on issues relating to refunds, a division bench comprising Justices Dinesh Mehta and Rajneesh Kumar Gupta, said the amount relating to Vi for assessment years 2003-04 (Apr-Mar) and 2008-09 to 2013-14 is still lying with the department after 10 years of legal battle which it had won before the Income Tax Appellate Tribunal in June 2024.

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"Once the assessment by a competent assessing officer (AO) has been made under Section 201 of the Act of Income Tax Act 1961 and/or any appellate authority passes an order and the refund arises or emanates therefrom, it becomes a vested and crystallised right of an assessee to get the refund, along with applicable interest, subject of course to the department's right to challenge such order in accordance with law. Such order is neither subservient to Section 200A of the Act of 1961 nor to Rule 31A of the Rules of 1962," the order stated.

Vi's plight does not end here, the HC said, adding that even after having won the legal battle before the tribunal, and though the AO found an amount of ₹53.09 crore refundable to it in October 2024 and May 2026, it has still not remitted the amount. This time the AO took refuge of Form 26B and purported outstanding demand of petitioner's sister TANs (Tax Deduction and Collection Account Numbers) to the tune of ₹10.91 crore," the HC said, while holding it to be "a fit case for imposition of exemplary cost, but we make the case easy."