Suzlon Energy Ltd, a company dedicated to providing renewable energy solutions, faced a setback recently when it was hit with a hefty penalty of ₹260.35 crore by the National Faceless Assessment Centre of the Income Tax Department. This penalty relates to assessments for the years 2016-17 and 2017-18.
The issue stemmed from the rejection of Suzlon’s claim for depreciation on goodwill, along with disallowances under Sections 14A and 36(1)(va) due to delayed payments of PF/ESI.
As expected, Suzlon Energy is contesting this penalty, arguing that the penalty proceedings should have been put on hold until the ongoing quantum appeal against these disallowances reached a conclusion.
They emphasized that their appeal against these disallowances is still in progress before the tribunal, making the penalty seem premature in their eyes.
In a statement, Suzlon Energy expressed, “We’re currently challenging the penalty order through the appropriate channels and are confident in our ability to defend ourselves based on the facts, merits, and legal precedents that support our case.”
Breaking down the penalties, Suzlon highlighted that for the assessment year 2016-17, they were penalized ₹87.59 crore, including ₹35.11 crore for Section 14A, ₹132.48 crore for goodwill depreciation under Section 32(1), and ₹1.14 crore for late PF/ESI payments under Section 36(1)(va).
For the subsequent assessment year 2017-18, the penalties amounted to ₹172.76 crore, with ₹16.29 crore for Section 14A, ₹231.83 crore for goodwill depreciation, and ₹1.47 crore for late PF/ESI payments.
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