IndiGo, India’s largest airline, is facing a ₹944.20 crore penalty from the Income Tax Department. However, the airline has called the order “erroneous” and plans to challenge it legally.
The penalty notice was issued to InterGlobe Aviation, IndiGo’s parent company, for the assessment year 2021-22. In a regulatory filing on Sunday, IndiGo asserted that the order is not legally justified.
According to the airline, the penalty is based on a misunderstanding. The tax authorities believe IndiGo’s appeal before the Commissioner of Income Tax (Appeals) [CIT(A)] was dismissed, but the airline clarified that the appeal is still active and under review.
IndiGo Challenges ₹944.20 Crore Tax Penalty
InterGlobe Aviation Ltd, the parent company of IndiGo, has been fined ₹944.20 crore by the Income Tax Department for the financial year 2021-22. The company, headquartered in Gurugram, has strongly opposed the penalty, calling it “wrong and baseless.” They have stated that they will take legal action to challenge this decision.
Despite the hefty fine, It assured that the penalty would not impact its flight operations, financial condition, or any other business activities. The airline remains confident that it will continue to function smoothly.
In an official statement, they explained that the Income Tax Department has misunderstood the situation. The tax authorities believe that its appeal, filed before the Commissioner of Income Tax (Appeals) under Section 143(3), was rejected. However, they clarified that the appeal is still active and awaiting a final decision.
The airline is determined to fight this penalty in court and prove that the order is unjustified.
Also Read: 7th Pay Commission: Expected DA Hike for Government Employees
IndiGo Rejects ₹944.20 Crore Tax Penalty
IndiGo has firmly rejected the claims made by the Income Tax Department, stating that the penalty order is incorrect and legally unsound. The airline emphasized that it plans to challenge the decision through proper legal channels, expressing confidence in the judicial system.
In an official statement, they reiterated its belief that the order is not in line with the law and is both “erroneous and frivolous.” The company assured that it will take necessary legal steps to contest the penalty.
Furthermore, they clarified that the penalty will not have any major impact on its financial health, daily operations, or overall business activities. The airline remains committed to resolving the issue while continuing its services without disruption.
IndiGo Shares Dip Slightly After Tax Penalty but
IndiGo’s stock price experienced a slight decline after receiving an order from the Income Tax Department, closing 0.32% lower at ₹5,113. However, despite this minor drop, the airline’s shares have shown strong growth throughout the year. its stock has increased by approximately 11.36% since the beginning of the year.
The airline’s stock had previously witnessed significant gains due to positive investor confidence. This optimism came after They announced its expansion plans and future growth strategies, which reassured investors about the company’s long-term potential.
As of December 2024, IndiGo’s promoters held a 49.27% stake in the company, indicating a strong ownership presence.
Also Read: Elon Musk’s Tesla Signs 5-Year Lease for First Mumbai Showroom
FAQs
Q.1. Why did IndiGo receive a ₹944.20 crore tax penalty?
Ans. It was fined by the Income Tax Department for the financial year 2021-22, but the airline claims the penalty is based on a misunderstanding.
Q.2. How is IndiGo responding to the tax penalty?
Ans. They have rejected the order, calling it “erroneous,” and plans to challenge it legally to prove its stance.
Q.3. Will the tax penalty affect IndiGo’s operations?
Ans. No, Indi Go has assured that the penalty will not impact its flight operations, financial condition, or business activities.
Q.4. What is the current status of IndiGo’s tax appeal?
Ans. They clarified that its appeal before the Commissioner of Income Tax (Appeals) is still active and under review.
Q.5. How has IndiGo’s stock reacted to the tax penalty?
Ans. Its stock dipped slightly by 0.32% but remains strong, showing an 11.36% increase since the start of the year.
