Bombay HC asks IT tribunal to hear Vodafone case expeditiously

0
5

Bombay-HCThe Bombay High Court directed the Income Tax Appellate Tribunal (ITAT) to hear the Rs. 3,700-crore transfer pricing tax demand dispute involving Vodafone India Services on a daily basis from February 21.

The division bench of Chief Justice Mohit Shah and Justice M S Sanklecha advanced the hearing date from March 21 to February 21, and directed the tribunal to hear and decide the matter expeditiously.

The court also asked both Vodafone and the Income Tax department not to seek any adjournments during the hearings.

The order was passed on a petition filed by the IT department challenging an interim order of the tribunal staying the Rs. 3,700 crore tax demand against Vodafone India.

The tribunal, in December last year, also directed the telecom giant to deposit Rs. 200 crore and provide corporate guarantees for the balance tax amount of Rs. 3,500 crore.

The IT department in its petition urged that the amount of Rs. 200 crore to be deposited by Vodafone was too low.

The department slapped a demand of Rs. 3,700 crore on Vodafone for FY08, which was a fall out of an earlier transfer-pricing order seeking to add Rs. 8,500 crore to the taxable income of the company from the deal that involved it selling its BPO unit to an offshore entity. The company challenged the demand before the Appellate Tribunal.

The IT department had in January slapped another Rs. 3,000 crore demand on the company in another transfer pricing case, which was stayed by the court on January 30.

Transfer pricing refers to the actual price at which a transaction takes place between two related parties, usually belonging to the same group.