VODAFONE SEEKS CONCILIATION TO RESOLVE TAX DISPUTE

British telecom major Vodafone has approached the Indian government to resolve its Rs 20,000- crore tax dispute through Conciliation. The government has already held one round of meeting following Vodafone’s move but the government is yet to finalise the contours of terms of reference of conciliation talks. The case is a dispute between The Vodafone group and the Income Tax department of India with regard to the acquisition by Vodafone Internationals Holdings.
It looks like the Finance Ministry today said it is open to considering a “fair and reasonable” conciliation proposal from Vodafone to resolve the long pending tax dispute as Minister of State for Finance Jayant Sinha said, “In this (Vodafone) matter, we have to go step by step. We have said constantly that we are willing to consider all fair and reasonable proposals and so we are working through the process…,”
The basic tax demand from Vodafone was Rs 7,990 crore but the total outstanding, including interest and penalty, is estimated to have risen to Rs 20,000 crore. The case relates to the retrospective amendment of the I-T laws carried out by the UPA government in 2012 in order to overturn the Supreme Court verdict which had favoured Vodafone.
This development comes even when the UK based telecom major has already initiated arbitration proceedings against the Indian Govenment. While both Indian Government and Vodafone had named their respective arbitrators, the two have not yet been able to agree on a third arbitrator to preside over the proceedings.