Consulting lawyers on proposed changes in I-T Act: Vodafone
In a quick response to the government's move to amend the I-T Act retrospectively to recover Rs 11,000 crore from Vodafone despite losing the case in the Supreme Court, the UK-based telecom major today said it has begun consultations with lawyers on the issue.india Updated: Mar 16, 2012 19:59 IST
In a quick response to the government's move to amend the I-T Act retrospectively to recover Rs 11,000 crore from Vodafone despite losing the case in the Supreme Court, the UK-based telecom major on Friday said it has begun consultations with lawyers on the issue.
"We are examining this proposed decision with our lawyers, but we do not believe this retrospective change in tax law should have any impact on the final judgement handed down by the Supreme Court in our tax case," Vodafone said in a statement.
The company, which recently won the withholding tax case against the government in the Supreme Court said, "We continue to have faith in the Indian judicial system."
In the Vodafone case, the Supreme Court had held that the Income Tax Department does not have the jurisdiction to levy withholding tax for its $11 billion acquisition deal with Hutchison Essar in 2007.
In the Budget, the government has proposed amending the I-T Act with effect from 1962 to bring under net all overseas transactions involving domestic assets.
Under the proposed amendment, whether resident or non-residents, having business connection in India will be required to deduct tax at source and pay it to the government even if the transaction is executed on a foreign soil.
"There are large number of similar (Vodafone type) cases which, could be impacted. Our rough assessment is that total impact of such cases would have been to the tune of Rs 35,000-Rs 40,000 crore," Revenue Secretary RS Gujral said.