Vedanta Ltd. Vs Union of India and others (Orissa High Court)
The Orissa High Court has directed Vedanta Ltd. to respond to a show-cause notice (SCN) issued by tax authorities regarding an ₹8.02 crore Input Tax Credit (ITC) dispute for the GST period from July 2017 to March 2018. The discrepancy between Vedanta’s accounts and its GST annual return was first identified by Vedanta itself and later flagged in a Comptroller and Auditor General (CAG) audit. Despite an explanation provided to tax authorities, the case remained pending, and a show-cause notice was issued on 5th August 2024, invoking the extended limitation period. Vedanta contended that the notice was issued on the last day of the extended timeframe without sufficient grounds.
The tax department argued that Vedanta’s response to the audit findings was unsatisfactory, and the SCN allows Vedanta another opportunity to explain its stance before a final decision is made. The High Court directed Vedanta to submit its reply, ensuring it can raise all legal objections, including the validity of the limitation period. The tax authorities are set to issue a final order by 5th February 2025, after which Vedanta can decide on further legal action. With these directives, the court disposed of the writ petition.
