Vodafone Idea presses for Rs 7,000 cr tax refund; I-T dept hesitant in view of fresh liability

NEW DELHI: Vodafone Idea, India’s third-largest telecom service provider, is seeking about Rs 7,000 crore in tax refunds for past years even as it faces fresh statutory dues liability – running into thousands of crore – that has put the income tax department in a bind, sources privy to the development said. The tax department has in past adjusted refunds against a company’s other liabilities towards the government. It had famously adjusted Rs 1,500 crore in tax refunds due to Cairn Energy plc of UK to part settle a retrospective tax demand of Rs 10,247 crore even though the matter was under arbitration.

Sources said Vodafone has to receive an aggregate of about Rs 1,000 crore from Mumbai unit of income tax department and another Rs 6,000 crore from its Delhi office for multiple assessment years dating back to 2004-05.

The company has got favourable rulings from High Courts and appellate tribunals in some and is now pressing the department to quickly refund the dues, they said.