Tags:
Journalism of Courage
The Centre on Friday moved the Supreme Court seeking review of its verdict holding that the Indian Income Tax Department does not have jurisdiction to levy Rs 11,000 crore as tax on the overseas deal between Vodafone International Holdings and Hutchison Group.
The court had on January 20 allowed Vodafone’s appeal and had quashed the Bombay High Court verdict which had upheld the decision to levy tax on the overseas deal.
The apex court held that Vodafone’s transaction with Hong Kong-based Hutchison Group was a bonafide FDI which fell outside the tax jurisdiction of the Indian authorities.
A Bench headed by Chief Justice S H Kapadia had held that the offshore transaction was a bonafide structured FDI investment into India which fell outside India’s territorial tax jurisdiction.
It had asked the I-T Department to return Rs 2,500 crore deposited by Vodafone,in compliance of its earlier interim order,within two months along with four per cent interest from the date of withdrawal of money by the tax department.
It also asked the Supreme Court registry to return within four weeks the bank guarantee of Rs 8,500 crore given by the telecom major.
Through the $ 11.2 billion deal in May 2007,Vodafone had acquired 67 per cent stake in the Hutchison-Essar Ltd (HEL) from Hong Kong-based Hutchison Group through companies based in the Netherlands and Cayman Island.
Meanwhile,Vodafone in a statement,said the apex court had clearly and unambiguously ruled that there was no tax to pay on the Vodafone-Hutchison transaction.
Vodafone notes the filing of the tax authorities review petition,which will be evaluated by the same Bench that ruled on the case and has no further comment to make at this stage, it said.
