Skip to main content

Vodafone for conciliation on tax dispute

By
"The govt has held one preliminary meeting to explore terms of reference of such a conciliation"
The government and Vodafone are getting closer to settling their eight- year tax spat over the 2007 Hutch- Vodafone crossborder deal. The British telecom major, which had sought arbitration under the Indo- UK bilateral investment protection treaty in June, has formally approached the finance ministry for conciliation.
In a series of tweets on Wednesday, Revenue Secretary Hashmukh Adia said “ Vodafone has in a written communication expressed its desire to go for conciliation for its tax disputes with India” and the government held a preliminary meeting to explore theterms ofreferenceofsuchconciliation on October 10. He, however, was quick to add that more follow- up meetings would be held for finalisation of the terms.
Sources familiar with the developments said in their meeting with Vodafone’s global chief executive Vittorio Colao last month, finance ministry officials had told him the government could look at waiving the penalty and interest component, if the firm is willing to pay the principal outstanding tax of about ? 8,000 crore of the total disputed amount of about ? 20,000 crore.
A spokesperson from London did not want to share specificenquiries by Business Standard,but said the company has always made clear its openness to discuss the possibility of settlement, but the content of any discussions with the Indian government would remain confidential.
The Supreme Court had ruled in Vodafone’s favour in 2012, saying it was not liable to pay tax over the acquisition of assets in India fromHutchison. Thegovernment, however, amended the laws with retrospective effect to undo the judgment and claim taxes.
CASE HISTORY
  • Sept 2007: Vodafone International BV slapped with $2- billion income tax demand.
  • Jan 2012: SC says transaction carried outside India cannot be taxed, sets aside I- T depts claim.
  • Feb 2012: I- T department slaps ~3,100- crore tax notice on Vodafone India.
  • Mar 2012: Pranab Mukherjee (then FM) proposes to amend I- T Act to retrospectively tax foreign transactions.
  • Sept 2013: Bombay HC dismisses Vodafones petition, refers it back to tax tribunal.
  • Oct 2014: Bombay HC strikes down ~ 3,100- crore tax demand in Vodafone India.
  • Dec 2014: Tribunal says Vodafone liable for tax payments.
  • Sep 2015: HC sets aside tribunal order on Vodafone tax notice.
  • Oct 2015: Bombay HC rules in favour of Vodafone in transfer pricing case of call centre business.
Business Standard, New Delhi, 19th Nov. 2015

Comments

Post a Comment

Popular posts from this blog

Govt’s gamble on GST cuts: What do the bond and currency markets signal?

By
  It’s not just humans who suffer from cognitive biases; markets do too. Interestingly, different financial markets exhibit distinct biases, each interpreting events through its own prism of prejudice. Take the recent announcements on GST reforms: equity markets have chosen to view them through the lens of growth, while bond and currency markets are focusing on potential macroeconomic risks—fiscal pressures and current account challenges. So, which lens captures the true pulse?Equity markets may be right in expecting GST reforms to revive consumption, which has remained lacklustre for a while. But the key question remains—will this revival come at the cost of broader macro stability?It is well known that consumption stocks have rallied since the GST rationalisation announcement. But what about bond markets? What signals are they sending since this rejig was announced from the ramparts of the Red Fort?The signs aren't encouraging. Bond prices have slumped and yields have surged sinc...
Post a Comment
Read more

Luxury carmakers urge clarity on GST rates to boost festive season sales

By
  A clear picture regarding new GST rates at the earliest will help the overall auto industry, including the luxury car segment, to regain momentum in the ongoing quarter, which generally sees enhanced sales on account of the festive season.The high-powered GST Council, chaired by Finance Minister Nirmala Sitharaman, will meet on September 3-4 to discuss moving to a two-slab taxation.In an interaction with PTI, BMW Group India President and CEO Hardeep Singh Brar said the recent speculation about the change in GST rates has caused uncertainty in the minds of consumers.Consumer interest and demand is strong, but they (prospective buyers) have adopted a wait-and-watch approach, and this delayed decision-making is impacting new vehicle sales at a certain level, he noted."Expediting clarity on GST rates is essential to get back to speed and ensure the auto sector's contribution to economic growth during this quarter is robust," Brar stated.He also hoped that the sustainable p...
Post a Comment
Read more

Sebi proposes tighter norms for green bond third-party reviewers

By
  Sebi on Friday said it has proposed to tighten the norms to appoint independent third-party reviewers or certifiers for green debt securities to align them with requirements for other ESG-linked bonds.In a draft circular, Sebi said that the current norms for green bonds, introduced in February 2023, lack detailed requirements around reviewer independence, conflict of interest mitigation, and disclosure standards that are now in place for other ESG-linked securities under a June 2025 circular.The regulator's latest proposal seeks public comments on a revised framework that would bring parity by incorporating comprehensive criteria for third-party certifiers of green bonds on non-convertible securities.Under the proposed norms, issuers of green debt securities will need to appoint reviewers who are independent of their management, directors, and key managerial personnel. These reviewers will be remunerated in a way that prevents any conflicts of interest and possess relevant expert...
Post a Comment
Read more