In a significant victory for Vodafone Idea Ltd, the Supreme Court on Tuesday (January 20) upheld the  Bombay High Court’s November 2023 decision granting the company a tax refund of ₹1,600 crore.

The tax department has already issued this refund to Vodafone Idea.

The apex court dismissed the tax department’s appeal, citing an unexplained delay of 295 days in challenging the High Court’s relief. The court criticised the tax authorities, calling the delay “gross” and unjustified.

There is a gross delay of 295 days in filing the Special Leave Petition which has not been satisfactorily explained by the petitioners,” the Supreme Court said.

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The Bombay High Court in November 2023, had ruled in favour of Vodafone Idea, directing the tax department to refund the amount paid by the telecom operator in taxes for the assessment year 2016-2017. The assessment order passed by the department in August 2023, was time-barred and hence cannot be sustained,” the HC noted in its judgement on Wednesday.

A division bench of Justices K R Shriram and Neela Gokhale also took a strong view against the assessing officer for showing laxity and lethargy in not passing the final order within the mandated 30-day time and thus causing a huge loss to the exchequer and public.

The court passed its judgment on a petition filed by Vodafone Idea claiming the I-T department failed to refund the amount paid by it for the assessment year 2016-2017 which, it said, was in excess of the legitimate tax due on its income.

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The bench in its order noted the case of Vodafone was quite elementary and that it was constrained to observe the complete apathy and negligent approach of the assessing officer concerned in discharging his duties in accordance with provisions of the Income Tax Act.

Shares of Vodafone Idea Ltd ended at ₹9.95, up by ₹0.83, or 9.10% on the BSE.