Supreme Court dismisses Rs 363 crore GST demand against Vodafone Idea on tower business sale

New Delhi: The Supreme Court on Monday dismissed the government's appeal seeking to revive its '363 crore goods and services tax demand against Vodafone Idea (Vi) on the sale of Vodafone Mobile Services ' tower business to ATC Telecom Infrastructure. The apex court also questioned the government on how these proceedings could have been initiated against Vodafone Mobile Services, a non-existent entity. Vodafone Mobile Services, which was a unit of Vodafone India, became non-existent after the 2018 merger between Vodafone India and Idea Cellular to form Vodafone Idea. Read more: Vodafone Idea ropes in Shah Rukh Khan for new brand identity campaign A bench led by Justice JB Pardiwala upheld the Bombay High Court's April 29 decision that quashed the tax proceedings initiated against Vi on the grounds that VMS had ceased to exist and the merged entity had no status in the eyes of law. The HC further stated that these tax proceedings against VMS were without jurisdiction and "stood vitiated" and rendered "void ab initio". The department argued that the SC's earlier ruling to not initiate income tax proceedings against non-existent companies applied to only income tax cases and not GST cases.The GST law is a complete code in itself and has provisions for fixing the past liabilities, including in case of amalgamations and mergers, the department said. It relied on Section 87 of the Central Goods and Services Tax Act, 2017, to argue that liabilities relating to the period before the merger could still be pursued.