I-T Dept all set to challenge Bombay HC verdict in Vodafone tax case
The Income Tax department on Wednesday said it will challenge in the Supreme Court the Bombay HC order in the Rs 8,500-crore transfer pricing case. “In the case of one of the cases of Vodafone, it has been decided to file SLP before Hon’ble Supreme Court against the order of Mumbai HC,” the I-T department said.
In October 2015, the Bombay High Court had set aside an order of Income Tax Appellate Tribunal (ITAT) which had ruled that the I-T department had powers to raise tax demand on the company in a Rs 8,500 crore transfer pricing (TP) case. The transfer pricing case dates back to 2008 relating to sale of one of its call centres in Ahmedabad in 2007. “A substantial question of law has arisen on the issue of taxability of capital gains arising on the surrender of call option rights,” the I-T department tweeted. In its ruling the Bombay High Court held that surrender of option rights is not a transfer under the provisions of I-T Act.