The Mumbai Income Tax Department has provided a refund of Rs 2,568 crore telecom sector major, Vodafone after the country's Supreme Court reuled in favor of the company in the long-standing tax case.

The It department made a deduction of Rs 50 crore from the final amount for TDS and refunded the remaining amount to the company. The department has been calculating the interest and TDS component on the principle amount of Rs 2,500 crore over the last few days.

Soon after the verdict in Delhi in which the Supreme Court said that it would not accept a review petition from the department, the officials issued a cheque to the company. The company had deposited the money in January 2011.

The department had filed a review petition in the apex court in the case after a ruling by the court that said that the British telecom giant has no dues to pay to the Indian taxation authorities.

The company's court victory in a case, lasting more than four years, came as the Supreme Court dismissed the government's demand for $2.2 billion in taxes from Vodafone for its acquisition of Hutchison Whampoa Ltd's India operations in 2007.

The ruling had cleared the confusion on weather global companies can use offshore holding companies to avoid paying taxes in India. Vodafone acquired its partner Essar Group's stake for $5.46 billion last year to consolidate its control over the company, which is a leading player in one of the biggest telecom market in the world.