Vodafone taxation controversy in India is not willing to die. Vodafone has claimed that on Saturday it has received a reminder notice from Indian tax authorities on disputed tax dues. The dues pertain to the acquisitions made by Vodafone in the year 2007 of Indian mobile assets. However, no deadline has been prescribed for the payment by the tax authorities of India.
Vodafone has given a standard reply by stating that according to Vodafone’s beliefs no tax is due to be paid by it. Vodafone is of the firm opinion that no tax is payable on the above transaction made in the year 2007. Vodafone’s major relief point is the judgement given by the Supreme Court of India in its favour.
The only option left for India was to formulate and enact a validation law that can cure the defects pointed by the Supreme Court while adjudicating the Vodafone’s case. The government exactly did the same thing by amending 50-year-old tax laws enabling it to make retroactive tax claims on long-concluded corporate deals.
The constitutionality of such retrospective validation law is still to be analysed. However, this retrospective amendment has once again brought to life the dead Vodafone taxation controversy.