The Mahanagar Telecom Nigam Ltd will get a tax refund of Rs 264 crore (Rs 2.64 billion) from the Income-Tax Department on account of interest payable by the department for 1997-98 and has further sought a refund of about Rs 1,116.67 crore (Rs 11.166 billion) after taking into account all the assessment years in which licence fee has been disallowed.
For the assessment year 1997-98, as against the payment of tax of Rs 211.18 crore (Rs 2.111 billion) -- out of which Rs 194 crore relates to disallowance of licence fee -- MTNL is eligible to get a refund of about Rs 264 crore, the company said in a statement.
The demand came after Income Tax Appellate Tribunal Delhi bench held that licence fee paid by MTNL to the Department of Telecom is a statutory liability and the same is an allowable deduction in the year 1997-98.
MTNL claimed that even if the above order of ITAT relates to the assessment year 1997-98, the cases of other assessment years are still pending before the tribunal.
As per the practice, once an item is decided by the tribunal, it is followed for the other years also.
"Therefore, MTNL will be pleading before the I-T department to apply the effect of this judgement of ITAT for assessment year 1997-98 to all the other years in which licence fee has been disallowed. In effect, MTNL will be benefiting with cash refunds of about Rs 1116.67 crore for the assessment years (1994-95-2001-02) if allowed by the department," it said.