MTNL to get Rs 1,380-crore as tax refund

Written by Agencies | fe Bureaus | New Delhi | Updated: Mar 20 2010, 09:32am hrs
State-run telcom operator MTNL is set to get a tax refund of Rs 1,380 crore for four assessment years, a positive cash-flow development for the PSU which is facing challenging times in terms of profitability and competition.

When contacted, company chairman and managing director Kuldip Singh said, "We are hoping to get some tax refund shortly.

A senior company official said the refund comes after the income tax appellate tribunal (ITAT) upheld the companys stance on tax dispute for the fiscal years 1998-99, 1999-2000, 2000-2001 and 2005-06. The PSU would get Rs 756 crore along with Rs 624 crore interest for the four assessment years totalling Rs 1,380 crore.

The stock markets lapped up the news and the MTNL counter saw brisk action on Friday. The stock hit a high of Rs 77 during the day but closed at 74.95, up 3.09% on a day when the index just rose 59 points.

The official said MTNL has received the orders but is yet to get the cheque. But it will surely be accounted for in the fourth quarter results. The official also said the tribunal has yet to dispose of another refund case involving Rs 900 crore. The ITAT had earlier given its decision in favour of the company.

MTNL reported a net loss of Rs 894.95 crore in the quarter ending December, 2009 compared with a net profit of Rs 53.10 crore in the year-ago quarter. Its sales also declined to Rs 902 crore in the same period.