ITAT scraps ₹11,003cr tax disallowance against Reliance Jio for 2019-20
Business
Big win for Reliance Jio: the Income Tax Appellate Tribunal (ITAT) has scrapped a massive ₹11,003 crore tax disallowance for 2019-20.
The issue? Jio listed certain costs, like network charges and salaries, as regular business expenses for taxes, but marked them as work in progress in their financials.
ITAT rejects assessing officer's view
ITAT rejected the assessing officer's view that these expenses were about keeping Jio's current network running smoothly, not building new assets.
The tribunal also said tax rules don't have to copy accounting methods exactly, and called out the tax officer for lumping all costs together as a single big investment.
In short: purpose matters more than paperwork labels here.