The bench, in its July ruling, additionally directed the division to pay Flipkart curiosity on the complete deposit quantity from the date of fee till the refund is made
The dispute pertains to tax authorities classifying telephone chargers as an unscheduled commodity and elevating a requirement of INR 23.01 Cr towards Flipkart for interval between 2011-12 and 2014-15
After a division bench of the HC dominated in favour of Flipkart in 2022, the tax division refunded solely the money portion whereas withholding the ITC half
The Karnataka Excessive Court docket (HC) has reportedly directed the state’s business taxes division to refund INR 16.11 Cr to Flipkart
India. The ecommerce big had paid the quantity as a part of a INR 23 Cr pre-deposit whereas difficult sure tax evaluation orders.
As per Financial Occasions, a bench comprising Justice SR Krishna Kumar, in its July ruling, additionally directed the division to pay Flipkart curiosity on the complete deposit quantity from the date of fee till the refund is made.
Notably, the dispute pertains to Karnataka tax authorities classifying cell phone chargers as an unscheduled commodity. Subsequently, native officers raised a requirement of INR 23.01 Cr for the tax interval between 2011-12 and 2014-15 by way of 4 separate reassessment orders in 2016 and 2017.
Flipkart deposited INR 6.90 Cr in money and INR 16.11 Cr by way of enter tax credit score (ITC) whereas contesting the demand.
In 2022, the Karnataka Appellate Tribunal dominated in Flipkart’s favour, adopted by a division bench of the Karnataka HC additionally later dismissing the gross sales tax revision petition filed by the division.
Notably, the tax division solely refunded the money portion whereas withholding the ITC half. It argued that such deposits couldn’t be returned in money.
Nevertheless, the HC has now clarified that refunds have to be made in money, no matter whether or not the pre-deposit was paid by money or ITC.
This case is an element of a bigger historical past of Flipkart’s tax disputes throughout states. The ecommerce main has beforehand confronted calls for from revenue tax authorities, ESOP-related disputes, and refund delays.
In 2023, the Karnataka HC granted Flipkart interim aid towards a tax demand of over INR 1,100 Cr linked to evaluation years 2016-17 and 2018-19. Courts in Karnataka and Delhi have additionally dominated in favour of Flipkart and its workers in ESOP-related tax circumstances, holding such compensation as capital receipts relatively than wage revenue.
That mentioned, the corporate has been aggressively launching new providers to create new income streams forward of its IPO. In August, the corporate rolled out Flipkart Black, a paid subscription service positioned as a competitor to Amazon Prime.
It additionally acquired a majority stake in Pinkvilla India, a digital media platform, for an undisclosed sum to spice up its content material play.
In the meantime, on the monetary entrance, the ecommerce main’s B2C arm, Flipkart Web, reported an working income of INR 20,493 Cr in FY25, up 14% from INR 17,907 Cr in FY24. On the identical time, the corporate managed to chop its losses by 37% to Rs 1,494 crore within the fiscal beneath assessment from Rs 2,359 crore within the 12 months in the past interval.
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