ReutersThe government on Wednesday told the Delhi High Court it will soon "arrive at a consensus" to settle a Rs 4,250-crore transfer pricing taxation demand raised on Vodafone India Services (VISPL). Vodafone through its counsel Anuradha Dutt sought liberty to proceed with the arbitration relating to this dispute if the settlement talks with the government fail, and requested clarification to the court's November 17, 2020, and December 8, 2020, orders relating to the case.
A division bench comprising Justices Siddharth Mridul and Amit Sharma asked the government to respond to the modification application filed by telecom service provider and posted the matter for further hearing on December 14. "We will be able to arrive at a consensus soon," government counsel Kirti Man Singh told the court. To this Dutt said, "We are largely agreeable."
Vodafone had in January 2017 sought arbitration relating to two disputes with the government. One of these was the 2012 retrospective tax case that was settled through an amendment in 2021 after Vodafone won the arbitration case in September 2020.
The other unsettled one relates to transfer pricing taxation demands raised against Vodafone India Services, a downstream subsidiary of Vodafone International Holdings BV (VIHBV).
Vodafone had given an undertaking on November 17, 2017, that it will proceed with the "arbitration commenced under the India-UK BIPA (Bilateral Investment Promotion and Protection Agreements) only if the award under the India-Netherlands BIPA already published was set aside".
The company requested HC to modify earlier orders to record that its undertaking given to court in 2020 "pertains exclusively to VIHBV disputes arising out of the measures liable to nullification, and that VISPL disputes remain within the remit of the pending arbitration under the India-UK BIT, subject of course to all rights, remedies and defences available to both the respondents and the Union of India".
A division bench comprising Justices Siddharth Mridul and Amit Sharma asked the government to respond to the modification application filed by telecom service provider and posted the matter for further hearing on December 14. "We will be able to arrive at a consensus soon," government counsel Kirti Man Singh told the court. To this Dutt said, "We are largely agreeable."
Vodafone had in January 2017 sought arbitration relating to two disputes with the government. One of these was the 2012 retrospective tax case that was settled through an amendment in 2021 after Vodafone won the arbitration case in September 2020.
The other unsettled one relates to transfer pricing taxation demands raised against Vodafone India Services, a downstream subsidiary of Vodafone International Holdings BV (VIHBV).
Vodafone had given an undertaking on November 17, 2017, that it will proceed with the "arbitration commenced under the India-UK BIPA (Bilateral Investment Promotion and Protection Agreements) only if the award under the India-Netherlands BIPA already published was set aside".
The company requested HC to modify earlier orders to record that its undertaking given to court in 2020 "pertains exclusively to VIHBV disputes arising out of the measures liable to nullification, and that VISPL disputes remain within the remit of the pending arbitration under the India-UK BIT, subject of course to all rights, remedies and defences available to both the respondents and the Union of India".
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