IndiGo gets Rs 944 crore tax penalty, calls it erroneous and frivolous

InterGlobe Aviation Ltd, the parent firm of low-cost carrier IndiGo, announced on Sunday that it was imposed with a penalty of Rs 944.20 crore by the Income Tax Department for the Assessment Year 2021-22. Nevertheless, the company located in Gurugram described the penalty order as “incorrect and trivial” and stated it would seek legal actions to contest it.

The company stated that the order would not affect the airline’s operations, finances, or other activities.

“The Income Tax Authority has passed an order imposing a penalty of Rs 944.20 crore for the Assessment Year 2021-22. The order has been passed on the basis of an erroneous understanding that an appeal filed by the company before the Commissioner of Income Tax (Appeals) against the Assessment order under Section 143(3) has been dismissed, whereas the same is still alive and pending adjudication,” the airline said in a statement.

Further, IndiGo refuted the claims, asserting that the decision is flawed and lacks legal merit. In response, the airline has stated its intent to challenge the order through appropriate legal channels, emphasizing its confidence in the judicial process.

“The company strongly believes that the order passed by the Income Tax Authority is not in accordance with law and is erroneous and frivolous. Accordingly, the company will contest the same and shall take appropriate legal remedies against the aforesaid order. Therefore, the said order does not have any significant impact on financials, operations or other activities of the company,” it added.

The stock had earlier experienced notable increases due to positive investor sentiment after the airline revealed its expansion plans and future growth strategies. As of December 2024, promoters owned a 49.27 percent share in IndiGo.