NEW DELHI: Telecom operator Vodafone Idea (VIL) said on Thursday that it has received a GST penalty order of approximately Rs 638 crore from the Office of the Additional Commissioner, Central Goods and Services Tax, Ahmedabad. In an exchange filing, India's third-largest telecom service provider said it disagrees with the order and will take legal action against it.
The order, passed under Section 74 of the Central Goods and Services Tax Act, 2017, confirms a penalty of Rs 6,37,90,68,254 along with applicable demand and interest. The order, received on Wednesday, pertains to allegations of 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. The company does not agree with the order and will take appropriate legal action(s) against it," Vodafone Idea said.
Meanwhile, the telco received significant relief as the government approved restructuring of the company's Adjusted Gross Revenue (AGR) dues. The decision provides a five-year moratorium on a critical payment of approximately Rs 18,000 crore, originally due by March 31, 2026. The dues for FY 2017-18 and FY 2018-19 will be payable over six years between FY 2025-26 and FY 2030-31.
The Cabinet has frozen VIL's total AGR dues as of December 31, 2025, at ₹87,695 crore, rescheduled for payment over 10 years from FY 2031-32 to FY 2040-41. This follows Supreme Court judgments allowing the government to reconsider the dues, citing larger public interest and the government's 49% stake in the telco.