Voda Idea will have to pay outstanding taxes
When Vodafone and Idea merged, it became the largest telecom company in the country, but gradually Reliance Jio and Airtel left it behind in the competition. To make its condition worse, its debt and spectrum-related dues to the government also left no stone unturned. Now the company will have to face another new problem — it will have to pay taxes of Rs 15.19 lakh crore.
Yes, the country’s Goods and Services Tax (GST) Department has sent a notice to the company to pay a tax of Rs 15.29 crore. Not only this, a fine of Rs 1.51 crore was also imposed on the company.
misuse of input tax credit
The GST department says that Vodafone Idea has wrongly availed the input tax credit benefit available under GST. Therefore, the company has been ordered to make payment of Rs 15.19 crore. A fine of Rs 1.51 crore has also been imposed on the company for this misuse of ITC. Vodafone Idea is already facing a lot of fund-related issues. The company has recently planned to raise Rs 25,000 crore.
Vodafone Idea has also given information about this in its communication to the stock exchange. The company says that it has received the order to pay this money from the GST office in Patna. This is not a recent issue of the company paying taxes, but this penalty was imposed for availing the benefit of Input Tax Credit (ITC) even after not being eligible in the financial years 2019-20 and 2020-21. Vodafone India Limited says that it does not agree with this order and will take appropriate legal action in this regard.
Order received on August 28th.
The company says that the Joint Commissioner of CGST and Central Excise in Patna passed an order under the Central Goods and Services Tax Act, 2017. In this case, a total demand of Rs 15,19,20,351 was levied by imposing a penalty of Rs 1,51,92,035 and pending interest. It received this order on August 28. It has been accused of “availing ineligible input tax credit for the financial years 2019-20 and 2020-21”. The company says that this amount includes the tax demand, interest and penalty levied.
What is input tax credit?
Input tax credit exemption is available in the GST system. It can be understood in simple language that if orange juice is purchased, the machine, orange and packaging material were used to make the final product. Now, in such a situation, the final tax on the orange juice packet will be charged to the customer. But the tax already paid by the seller of the final product on the goods used to make it can be claimed as input tax. In reality, its benefit is mainly in B2B trade.
