In 2012, Indian govt amended the Income Tax Act retrospectively.
ET Bureau | December 25, 2020, 14:29 IST
TRANSACTION
MAY, 2007: Vodafone acquired stake in Hutchison Essar for $11.2 bn
Vodafone International Holdings BV bought the stake of Hutchison Telecommunications International Ltd in Hutchison Essar
Deal between companies based overseas; executed in Cayman Islands
TAX TROUBLE
OCT 30, 2009: Income tax dept served notice to Vodafone International Holdings
Notice under Sections 201 and 201 (1A) of the Income Tax Act for non-deduction of tax at source on the $11.2 bn transaction
OCT 30, 2010: IT Dept ordered Vodafone to furnish Rs 11,218 cr under Sections 201 and 201(1A).
APR 29, 2011: Rs 7,900 cr penalty was imposed
LITIGATION
SEPT 8, 2010: The Bombay High Court upheld the tax authorities decision. Dept raised tax demand in the subsequent month
JAN 20, 2012: SC set aside Bombay High Court decision; quashed tax & interest demand
It said transaction was between two overseas entities & Indian tax authorities had no territorial tax jurisdiction
FEB 17, 2012: Govt filed review petition
MAR 20, 2012: SC dismissed the review petition
THE RETRO AMENDMENT
2012 Indian govt amended the Income Tax Act retrospectively
Section 119 of the Finance Act validated the tax levied on Vodafone
Government said the amendment was only a clarification to remove ambiguity and provide certainty
TAX DEMAND BACK ON TABLE
JAN 3, 2013: IT dept raised a fresh demand was issued for Rs 11,218 cr
Vodafone subsequently sought to settle the case
A committee set up to resolve the issue failed to make any headway
ARBITRATION
APR 2014: Vodafone served arbitration notices under the India-Netherlands treaty
New government did not roll back demand but said no fresh action under retrospective tax
A fresh demand was issued on February 12, 2016, for Rs 22,100 cr tax
SEPT 25, 2020: The Hague-based arbitration court ruled in favour of Vodafone
DEC 21, 2020: India challenges arbitration award at Singapore
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