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Vodafone Idea Hit with Rs 638 Crore GST Penalty, Vows Legal Fight

Vodafone Idea has received a GST penalty order demanding approximately Rs 638 crore from tax authorities in Ahmedabad. The order, issued under Section 74 of the CGST Act, alleges short payment of tax and excess availment of Input Tax Credit. The telecom giant has firmly stated it disagrees with the order and will pursue legal action to challenge it. This development comes shortly after the company had to clarify speculative reports about potential government relief on its massive AGR dues.

Key Points: Vodafone Idea Gets Rs 638 Crore GST Penalty Order

  • Rs 637.91 crore GST penalty
  • Order alleges tax shortfall & excess credit
  • Vi plans legal challenge
  • Follows speculation on AGR relief
2 min read

Vodafone Idea receives GST penalty order of Rs 637.91 crore, to take legal action

Vodafone Idea receives a GST penalty order of Rs 637.91 crore for alleged tax shortfall. The company disputes the order and plans legal action.

"Company does not agree with the Order and will take appropriate legal action(s) - Vodafone Idea Exchange Filing"

New Delhi, Jan 1

Vodafone Idea on Thursday said it has received a GST penalty order of Rs 637.91 crore, passed under Section 74 of the Central Goods and Services Tax Act, 2017.

In an exchange filing, the telecom company said it received the penalty order from the Office of the Additional Commissioner, Central Goods and Services Tax (CGST), Ahmedabad South, on December 31.

The order has been passed under Section 74 of the Central Goods and Services Tax Act, 2017, "confirming a penalty of Rs 6,37,90,68,254 along with the demand of tax and applicable interest," the company said.

It further stated that the "Company does not agree with the Order and will take appropriate legal action(s) against the same".

The order alleges short payment of Tax and excess availment of Input Tax Credit. The maximum financial impact is to the extent of tax demand, interest and penalty levied.

However, the telecom operator said it does not agree with the order and will take appropriate legal action against it.

Earlier on Wednesday, Vodafone Idea issued a clarification after reports claimed that the Union Cabinet had approved a five-year moratorium and frozen the company's adjusted gross revenue (AGR) dues at Rs 87,695 crore.

In a stock exchange filing, Vodafone Idea said the reports were speculative in nature and that it had not received any official communication confirming such a decision. "We have not received any communication from the Government in relation to the above reported matter," the telecom operator stated in its exchange filing.

"As and when there is any development which requires disclosure, we will do the needful," it added.

The clarification came amid heightened market reaction to the reports. Following the earlier report, Vodafone Idea shares witnessed heavy selling pressure.

The company's shares closed at Rs 11.63 apiece, up by 8 per cent, on Thursday.

- IANS

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Reader Comments

S
Sarah B
The amount is staggering - over 637 crores! While companies should absolutely pay their fair share of taxes, such massive penalties can cripple an already stressed sector. Hope the legal process brings clarity. The telecom industry needs stability, not constant surprises.
A
Aditya G
This is why I switched to Airtel last year. The uncertainty around Vodafone Idea is too much. One day there's news of a bailout, the next day a massive penalty. As an ex-shareholder, I lost a lot of money. They need to get their house in order. 🤦‍♂️
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Priyanka N
The timing is interesting. Just after speculative reports about a moratorium. Maybe the tax department is sending a message that dues won't be forgotten? But if Vi genuinely believes the order is wrong, they should definitely challenge it. The law is the same for everyone.
K
Karthik V
As a small business owner, I understand GST complexities. Sometimes there are genuine differences in interpretation between taxpayer and department. But a penalty of this size suggests it's not a minor error. Hope the courts decide quickly for everyone's sake.
M
Michael C
Respectfully, while Vi has its challenges, the tax authorities must also ensure their orders are clear and justified. A penalty order right at the year-end feels aggressive. A struggling company providing jobs and services needs support to comply, not just punishment.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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