UK’s Vodafone demands time to answer India’s conciliation offer
23 Jun 2013 10:52 PM GMT
British telecom giant Vodafone has written to the tax department saying it needs some more time to reply to the latter's proposal for entering into a non-binding conciliation to resolve the long-standing tax dispute.
'Vodafone has replied. They asked for more time to reply to CBDT's letter as they want conciliation under UNCITRAL,' sources said, adding that the UK-based company is likely to decide on the proposal in its next board meeting.
Vodafone is facing tax liability of over Rs 11,200 crore on its 2007 acquisition of Hutchison Whampoa's stake in Hutchison Essar. The demand included Rs 3,300 crore of interest over delayed payment.The Union Cabinet earlier this month had approved a proposal for non-binding conciliation with the telecom firm, following which the Central Board of Direct Taxes (CBDT) formally wrote to the firm.The conciliation would be under the Indian Arbitration Law and not under the United Nations Commission on International Trade Law (UNCITRAL) as sought by Vodafone.
Sources said that if Vodafone enters into conciliation under Indian Arbitration Act then it would not be possible for it to seek arbitration under the UNCITRAL.
'Vodafone has replied. They asked for more time to reply to CBDT's letter as they want conciliation under UNCITRAL,' sources said, adding that the UK-based company is likely to decide on the proposal in its next board meeting.
Vodafone is facing tax liability of over Rs 11,200 crore on its 2007 acquisition of Hutchison Whampoa's stake in Hutchison Essar. The demand included Rs 3,300 crore of interest over delayed payment.The Union Cabinet earlier this month had approved a proposal for non-binding conciliation with the telecom firm, following which the Central Board of Direct Taxes (CBDT) formally wrote to the firm.The conciliation would be under the Indian Arbitration Law and not under the United Nations Commission on International Trade Law (UNCITRAL) as sought by Vodafone.
Sources said that if Vodafone enters into conciliation under Indian Arbitration Act then it would not be possible for it to seek arbitration under the UNCITRAL.
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