News : Vodafone to Challenge IT Department's Demand
New Delhi, Dec 20, 2013 -- UK-based telecom provider Vodafone said it will challenge tax authorities' order in a case related to sale of company's call centre business, for which a demand of crore was raised.
"Vodafone disagrees with the Dispute Resolution Panel decision relating to the transfer pricing order which Vodafone received in December 2011. Vodafone maintains that there is no tax payable on this transaction and the company will file an appeal before the tax appeal tribunal as soon as possible," the company said in a statement.
The case relates to the transfer pricing order in connection with sale of call centre business to Hutchison Whampoa Properties India Ltd and the "assignment of call options" to Vodafone International Holdings BV (VIHBV).
The IT Department's order was challenged by the British telecom provider on the ground that the disputed transactions were domestic in nature and did not fall within the jurisdiction of `transfer pricing' norms.
The IT department had issued a tax assessment order in December 2011 asking Vodafone to add an additional amount to its taxable income, thus raising the tax liability of the company.
"The facts of this case - including the transaction structure - were examined in considerable detail by India's Supreme Court, which delivered an unambiguous judgement affirming that there is indeed no tax due. Vodafone will continue to strongly defend its position against this Order,"the statement added.
The telecom provider is also facing a tax liability, along with interest, on its 2007 acquisition of Honk Kong-based Hutchison Whampoa's stake in India's telecom provider, Hutchison Essar.
Posted by Veronica Silva Cusi, news correspondent
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Established in 1994 to operate in the Turkish mobile telecommunications sector, Vodafone Group became a mobile operator under the name Vodafone Telekomünikasyon A.Ş. on May 24, 2006. Now the second largest mobile operator in Turkey, Vodafone has 18,000,000 subscribers. As England's first GSM carrier, Vodafone made the first mobile phone call on Jan. 1 1985. Vodafone Group Plc is the world's leading mobile telecommunications company, with a significant presence in Europe, the Middle East, Africa, Asia Pacific and the United States through the Company's subsidiary undertakings.
Published: Monday, December 23, 2013