 "We will examine Vodafone notice: Pranab")
**New Delhi:**Finance Minister Pranab Mukherjeetoday said the government will examine the notice of Vodafonethat threatened to drag India to international arbitration ifthe telecom giant was made liable to pay Rs 11,000 crore intaxes over a 2007 acquisition.
“It is their (Vodafone’s) prerogative and we will examinethe notice… As a legal entity, they are entitled to legalrecourse,” he said.
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The minister was responding to a question on the legalnotice served to the government by Vodafone’s Dutch unit.The company has served a notice of dispute to the Indiangovernment invoking an investment treaty between India and theNetherlands in conncection with tax liablity.
A proposal contained in the Finance Bill 2012 aims toamend law to retrospectively tax cross-border transactionsdating back to 1 April 1962. The move follows the SupremeCourt ruling that Vodafone wasn’t liable for taxes stemmingfrom its 2007 acquisition of Hutchison’s stake inHutchison-Essar.
At a CII meet, Finance Secretary RS Gujral said theproposed retrospective amendment and introduction of GeneralAnti Avoidance Rules (GAAR) are not to harass any company.“Let me say at this stage, intention of the government isnot to hassle anyone or to trouble anyone,” he said whiledismissing concerns among the industry that the move proposedin the Budget would impeede foreign investments.
Gujral also assured the industry that their concerns"will be resolved".
Vodafone sent the notice to Prime Minister’s Office, withcopies marked to Mukherjee, Law Minister Salman Khurshid andTelecom Minister Kapil Sibal, claiming the proposed lawviolated the international legal protections granted toVodafone and other international investors in India.
PTI