Wall Street Journal | April 5, 2011 | R. Jai Krishna
NEW DELHI — Vodafone International Holdings B.V., the Netherlands-based holding company of Vodafone-Essar Ltd., Tuesday said it has filed a petition in India’s Supreme Court challenging the country’s tax authority notice imposing penalties on the tax on its majority stake purchase in Hutchison Essar Ltd., in 2007.
“We expect the Supreme Court to hear the petition Thursday,” Simon Gordon, a spokesman for Vodafone, said on the phone from London.
The Supreme Court is already hearing an earlier petition by the Vodafone Group PLC unit’s plea against a move by local authorities to have it pay tax on the acquisition in Hutchison Essar, which was renamed Vodafone Essar. The Supreme Court is likely to hear this case on July 19.
“It is difficult to understand the rationale behind the tax authorities seeking to impose penalties on a matter which the tax authorities have themselves described as a ‘test case’,” Vodafone said in an emailed statement.
The latest penalty proceedings are likely to raise further concerns amongst potential investors into India, Vodafone said.
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