Vodafone Idea Ltd announced on Thursday that it has received two separate GST penalty orders from tax authorities, creating a combined financial exposure of over ₹83.00 crore. The telecom operator disclosed this development through a regulatory filing, outlining the details of both penalty orders received on December 24.

Mumbai GST Penalty Order

The Deputy Commissioner of State Tax, Andheri Division, Mumbai, has imposed the larger penalty in this case. The order details are as follows:

This penalty represents the majority of the total financial exposure faced by the company and relates specifically to alleged irregularities in licence fees and spectrum usage charges for the financial year 2018-19.

Bengaluru GST Penalty Order

The Office of the Principal Commissioner of Central GST, Domlur Commissionerate, Bengaluru, has issued a separate penalty order with different allegations:

This order covers a longer period spanning five financial years and focuses on alleged discrepancies in tax payments and input tax credit claims.

Company Response and Legal Strategy

Vodafone Idea has clarified that the maximum financial impact would be limited to the tax demand, interest, and penalties levied in these orders. The company has expressed strong disagreement with both penalty orders and announced its intention to pursue appropriate legal action for rectification or reversal of these decisions.

Financial Impact Assessment

The combined penalty exposure breakdown shows the significant financial challenge facing the company:

Beyond the penalty amounts, both orders also include additional tax demands and interest components, which could further increase the total financial liability if the company's legal challenges prove unsuccessful.

Vodafone Idea Limited has received a significant penalty order from tax authorities in West Bengal, as disclosed in a regulatory filing. The telecommunications company faces financial implications from this tax enforcement action while maintaining its position to contest the order.

GST Penalty Details

The Deputy Commissioner, Large Taxpayer Unit, West Bengal has issued an order under Section 73 of the Central Goods and Service Tax Act, 2017, imposing substantial financial obligations on the company.

Nature of Alleged Violations

The tax order addresses multiple compliance issues identified by the authorities during their assessment. The primary allegations center around input tax credit management and tax payment procedures.

Key violations cited in the order include:

• Alleged excess availment of Input Tax Credit
• Payment of tax under wrong head
• Other related contraventions under GST regulations

Company's Response and Financial Impact

Vodafone Idea has clearly stated its disagreement with the tax order and outlined its intention to challenge the decision. The company emphasized that it does not agree with the order and plans to take appropriate action for rectification or reversal of the same.

The disclosure was made pursuant to Regulation 30 read with Clause 20 of Para A of Part A of Schedule III of SEBI Listing Regulations, 2015, ensuring compliance with regulatory transparency requirements.

Regulatory Compliance

The company has fulfilled its disclosure obligations under SEBI regulations, providing comprehensive details of the tax order to stock exchanges. This regulatory filing demonstrates Vodafone Idea's commitment to maintaining transparency with stakeholders regarding material developments that could impact its operations and financial position.