Vodafone wins big tax dispute with government

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Vodafone does not have to pay retrospective taxes, the International Court of Justice has ruled.

British telecom company Vodafone has won a major lawsuit against India in an international court. The case came to a head on Friday. The case is being heard at the Permanent Court of Arbitration in The Hague. There, the court ruled that Vodafone was not treated fairly. The Indian government has been instructed to cover their legal costs.

The tribunal said that the tax burden imposed by the government on Vodafone was against the investment agreement between India and the Netherlands. The International Court of Justice has ruled that the government will not be able to recover any money from Vodafone. In addition, Vodafone will have to pay Rs 54.7 lakh as partial legal costs.

DMD Advocates represent the British Telecom Company in The Hague. In 2007, Vodafone bought Hutchison. The government says Vodafone will have to pay a hefty tax on the purchase, but the British company did not comply. The UPA-II government has asked Vodafone to pay a total of Rs 11,000 crore for TDS. Vodafone did not want to give that. As a result, the Manmohan Singh government directed Vodafone to pay Rs. 20,000 crore including fine.

The case was taken to court. The rate in the Supreme Court is central. At that moment, the country’s finance minister Pranab Mukherjee. The desperate finance ministry then decided that the law would be amended retrospectively to force Vodafone to pay. The hue and cry of this retrospective tax started in the corporate arena. Not only Vodafone but many other companies are in conflict with the government.

In 2014, Vodafone went to the International Court of Justice against the Government of India. Finally El Roy, Vodafone won. India is facing such retrospective tax cases with many, including Cairn Energy. If the rate is a lot of money will go to the country.