FAO order two years after DRP direction, unsustainable says HC, directs tax refund of over Rs 1000 crore to Vodafone Idea

MUMBAI: In a win for Vodafone Idea Limited, Bombay high court on Wednesday held that an assessment order of August 31, 2023 passed by the Faceless Assessing Officer (FAO) two years after directions issued by a dispute resolution panel (DRP) were “time barred’’ and unsustainable. The HC thus directed Income Tax authorities to refund to Vodafone Idea, over Rs 1128 crore in taxes paid in the assessment year 2016-17, with interest. The process has to be completed in 30 days, a division bench of Justices K R Shriram and Neela Gokhale directed.

Pulling up the FAO, the HC held, “If the provisions of Section 144C—requiring final orders in 30 days– as mandated by the Statute are not strictly adhered to, the entire object of providing for an alternate redressal mechanism in the form of DRP stand defeated’’ .