The Supreme Court on Friday said the Vodafone tax case is an "eye-opener" for the legislature to take measures to meet such unprecedented situations which arise due to "lack in our regulatory laws".
"Case in hand is an eye-opener of what we lack in our regulatory laws and what measures we have to take to meet the various unprecedented situations, that too without sacrificing national interest," justice KS Radhakrishnan, who wrote a separate judgment concurring with the findings of chief justice SH Kapadia and justice Swatanter Kumar, said.
The court said insufficient legislation might give opportunities for money laundering and tax evasion adding "it is imperative that Parliament would address all these issues with utmost urgency".
Justice Radhakrishnana said "the necessity to take effective legislative measures has been felt in this country but we always lag behind because our priorities are different.
"Lack of proper regulatory laws leads to uncertainty and passing inconsistent orders by courts, tribunals and other forums, putting revenue and tax payers at bay," justice Radhakrishnan said.
He said FDI and investment can be made by availing the benefit of treaties or "through tax havens" but the question which looms large is whether our company law, tax laws and regulatory laws have been updated so that there can be greater scrutiny of foreign investors.
"Certainty in law in dealing with such cross-border investment issues is of prime importance, which has been felt by many countries around the world and some have taken adequate regulatory measures so that investors can arrange their affairs fruitfully and effectively," the judge said.