Vodafone has failed to produce pact with Hutchinson: I-T Dept
In the eagerly-watched case involving the I-T Dept and Vodafone, the Income-Tax Department on Monday said telecom major has failed to produce its agreement with Hutchinson which alone can reveal the true nature of the transaction between the two m...
By PTI |
MUMBAI: In the eagerly-watched case involving the I-T Dept and Vodafone, the Income-Tax Department on Monday said telecom major has failed to produce its agreement with Hutchinson which alone can reveal the true nature of the transaction between the two mobile companies.
The I-T Dept submitted this before the Bombay High Court which was hearing a petition filed by Vodafone Essar contesting I-T Department's notice for capital gains tax to the tune of around $2 billion.
Vodafone International (a Dutch company) picked up Hutchinson's (based in Cayman Islands) 66 per cent stake in Hutchinson-Essar to form the Vodafone-Essar here in $11.2 billion deal in 2006.
While the I-T department has said it does have a capital gains claim because the assets are in India, Vodafone has maintained that that transfer of shares between two foreign companies is not taxable in India.
I-T Department's counsel argued today that Vodafone had failed to produce its agreement with Hutchinson which alone can reveal the true nature of the transaction.
Also, the Constitutional validity of the provisions of the I-T Act, which has been challenged by Vodafone, cannot be determined in the absence of the agreement, he said.
The amendment to Income Tax Act which was introduced by the latest finance act, seeks to expand definition of the term 'assessee-in-default' to include the seller who does not deduct tax at the source. It has retrospective effect.
The I-T Dept submitted this before the Bombay High Court which was hearing a petition filed by Vodafone Essar contesting I-T Department's notice for capital gains tax to the tune of around $2 billion.
Vodafone International (a Dutch company) picked up Hutchinson's (based in Cayman Islands) 66 per cent stake in Hutchinson-Essar to form the Vodafone-Essar here in $11.2 billion deal in 2006.
While the I-T department has said it does have a capital gains claim because the assets are in India, Vodafone has maintained that that transfer of shares between two foreign companies is not taxable in India.
I-T Department's counsel argued today that Vodafone had failed to produce its agreement with Hutchinson which alone can reveal the true nature of the transaction.
Also, the Constitutional validity of the provisions of the I-T Act, which has been challenged by Vodafone, cannot be determined in the absence of the agreement, he said.
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The amendment to Income Tax Act which was introduced by the latest finance act, seeks to expand definition of the term 'assessee-in-default' to include the seller who does not deduct tax at the source. It has retrospective effect.
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