IndiGo Faces Rs 944.20 Crore Penalty from Income Tax Department: Company to Challenge Order

IndiGo’s Parent Company Hit with Rs 944.20 Crore Penalty by Income Tax Department

InterGlobe Aviation Ltd, the parent company of popular airline IndiGo, has been slapped with a hefty penalty of Rs 944.20 crore by the Income Tax (I-T) department for the Assessment Year 2021-22. The news sent shockwaves through the aviation industry, with many questioning the basis of the penalty.

In a regulatory filing issued on Sunday, IndiGo revealed that the penalty was imposed due to an incorrect interpretation by the tax authorities. The airline clarified that the department mistakenly assumed that their appeal before the Commissioner of Income Tax (Appeals) had been dismissed, when in fact, the plea is still under adjudication.

IndiGo, headquartered in Gurugram, wasted no time in denouncing the penalty as ‘erroneous and frivolous’. The company made it clear that they will challenge the order through appropriate legal channels, emphasizing that it will not have a significant impact on their financial position or operations.

Despite the looming legal battle, IndiGo’s stock performance has remained relatively stable. On Friday, the airline’s shares closed 0.32 per cent lower at Rs 5,113. However, the stock has seen an impressive gain of 11.36 per cent on a year-to-date basis. Technical indicators suggest that the stock is trading above key moving averages, indicating a positive trend.

With a promoter holding of 49.27 per cent as of December 2024, IndiGo remains a strong player in the aviation industry. As the company gears up for a legal showdown against the tax penalty, it continues to exude confidence in its financial resilience and operational stability.

The aviation sector will be closely watching as IndiGo navigates through this challenging period, with many hoping for a swift resolution in the company’s favor.