Vodafone Idea entitled to Refund along-with Interest arising out of Return of Loss: Bombay High Court [Read Judgment]

The Bombay High Court in the case of Vodafone Idea Ltd. v Deputy Commr of Income Tax held Vodafone entitled to a refund arising out of the return of loss filed by it.

The assessee engaged in the business of telecommunication services filed its return of income declaring a loss to the tune of Rs 6600.47 crores which was subsequently revised. The petitioner had claimed a refund of the entire amount of tax paid at source amounting to Rs 565.28 crores and Tax Collected at Source of Rs 22,31,792. The return after being processed by the Department brought an amount of Rs 630.21 crores with the refund.

The respondents, however, did not release the refund and reasoned that the same shall be released on completion of the assessment.

It has been contended by the assessee that the AO did not take any steps for releasing of refund and had committed an error in the withholding of refund. Also that the auto-generated response cannot be considered to be an order under Section 241A.

The Bench constituting of Justices S.J. Kathawalla and Akil Kureshi held that the exercise of powers by the AO does not fulfil the requirement of Section 241A of the Act and hence the impugned orders are set aside and the Department was directed to release the refund of the petitioner arising out of the return filed and is to be done along with statutory interest within a period of 3 weeks from the date of receipt of copy of the present order.