InterGlobe Aviation Ltd, the parent company of IndiGo Airlines, announced on Sunday that it has been slapped with a penalty of Rs 944.20 crore by the Income Tax Department for the Assessment Year 2021-22. The company, however, dismissed the order as "erroneous and baseless," vowing to challenge it through legal avenues.

Despite the hefty fine, IndiGo assured that the ruling would have no bearing on its operations, financial position, or other business activities.

"The Income Tax Department has imposed a penalty of Rs 944.20 crore, citing an incorrect assumption that an appeal filed by the company before the Commissioner of Income Tax (Appeals) was dismissed. In reality, the appeal remains active and under consideration," IndiGo stated.

Asserting its stance, the airline argued that the order lacks legal validity and is based on a flawed interpretation. IndiGo emphasized its intent to pursue all available legal remedies to contest the penalty.

"We firmly believe that the Income Tax Authority’s order is legally unsound and without merit. Accordingly, we will challenge it and take necessary legal steps. Given this, the order will not significantly impact our financials, operations, or overall business activities," the airline added.

Following the announcement of the penalty, IndiGo's stock closed 0.32 percent lower at Rs 5,113. However, the airline's shares have demonstrated resilience, rising approximately 11.36 percent so far this year, according to Business Today.

The stock had previously surged due to positive investor sentiment, largely driven by IndiGo's ambitious expansion plans and strategic growth initiatives.

As of December 2024, IndiGo’s promoters held a 49.27 percent stake in the company.