“Will Take Legal Action,” Says Vodafone Idea on Rs 638 Crore GST Penalty

New Delhi: Vodafone Idea has said it will pursue legal remedies after receiving a GST penalty order amounting to Rs 637.91 crore, raising fresh concerns over regulatory and financial pressures facing the telecom operator. The order was issued under Section 74 of the Central Goods and Services Tax Act, 2017.
In a regulatory filing, the company confirmed that it received the penalty order on December 31 from the Office of the Additional Commissioner of Central Goods and Services Tax, Ahmedabad South. The order confirms a penalty of over Rs 637 crore, along with a demand for tax and applicable interest. The allegations relate to short payment of tax and excess availing of input tax credit.
Vodafone Idea stated that it does not agree with the findings of the tax authorities and has decided to challenge the order through appropriate legal action. The company said the potential financial impact would extend to the tax demand, interest and penalty imposed under the order.
The development comes at a time when the telecom operator is already navigating significant financial stress. A day earlier, Vodafone Idea had issued a clarification addressing reports that the Union Cabinet had approved a five year moratorium and frozen its adjusted gross revenue dues amounting to Rs 87,695 crore. The company said such reports were speculative and confirmed that it had not received any official communication from the government regarding any relief on AGR liabilities.
The clarification was issued amid strong market reaction to the unverified reports. Following the initial speculation, Vodafone Idea shares saw sharp movement as investors reacted to the possibility of financial relief. The company later reiterated that it would make appropriate disclosures if and when any official decision was communicated by the government.
Despite the uncertainty, Vodafone Idea’s stock ended Thursday’s session at Rs 11.63 per share, registering an increase of around 8 percent. The company continues to engage with regulatory authorities while managing legal challenges related to taxation and legacy dues.
The latest GST order adds another layer of complexity for the telecom operator as it seeks stability through legal recourse, regulatory clarity and long term financial restructuring in an intensely competitive market.