NEW DELHI: With P Chidambaram back in the finance ministry, all eyes are on him as investors await his next move on his predecessor's controversial tax issues, including the Rs 12,000 crore Vodafone case.
There is already talk of an out-of court settlement with the telecom giant that faces the prospect of a fresh notice after the government retrospectively amended the law to levy capital gains tax on its acquisition of Hutch's stake in the Indian venture. "If the law had to be amended it should have been amended when the Bombay High court ruled in the government's favour," said a top official. The Supreme Court had overturned the order on the grounds that the Hutch-Vodafone deal was an offshore deal that was outside the jurisdiction of Indian tax authorities.
Vodafone has received a notice as "an agent" of Hutch for its failure to deduct tax while paying the consideration to the Hong Kong-headquartered entity which did the transaction through a Cayman Island-based entity. Chidambaram refused to discuss anything with the media on the day he took charge at the finance ministry for a third term. The Harvard-educated lawyer is no stranger to long-drawn tax cases.
Edited By Cen Fox Post Team
