Telecom major Vodafone , a Holland based multinational company is facing litigation proceedings from the Income-tax Department in India over the issue of payment of capital gains tax to the tune of $ 2 billion, as demanded by the Income Tax Department.
On Monday Vodafone squarely denied any liability for the capital gains tax arising out of its acquisition of Hutch shares, saying that a share purchase deal between two foreign companies was not taxable in
Vodafone, which picked up the stake of Hutchisson-Essar to form Vodafone Essar in $ 11.2 billion deal, is contesting the Income-tax Department’s notice for capital gains tax to the tune of around $ 2 billion.
The final hearing on Vodafone’s petition started before the Bombay High Court on Monday.
Arguing for Vodafone, senior counsel Iqbal Chagla termed the case as a ‘path breaking matter’ saying that for the first time the IT Department is seeking to collect tax in this way.
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