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Rediff.com  » Business » Vodafone CEO to visit India in Dec, may meet Chidambaram

Vodafone CEO to visit India in Dec, may meet Chidambaram

November 24, 2013 18:39 IST

Pending the settlement of its Rs 11,200 crore (Rs 112 billion) tax dispute with authorities in India, UK-based Vodafone's Chief Executive Vittorio Colao is scheduled to visit India in the first week of December and may meet Finance Minister P Chidambaram.

Colao will be in New Delhi early next month, a source said, adding that he is expected to meet the minister and several senior officials.

The British telecom major is facing a tax liability of over Rs 11,200 crore, along with interest, on its 2007 acquisition of Hong Kong-based Hutchison Whampoa's stake in India's telecom major, Hutchison Essar.

Vodafone and the government are in pre-conciliation talks towards the settlement of long-pending tax dispute.  While Vodafone has selected its senior official Mathew Kirk, the government has selected law Secretary P K Malhotra as its representative for the pre-conciliation talks.

The company has expressed keenness to reach an amicable settlement on the matter. It had offered to settle the dispute through conciliation to which government agreed, but there are differences over the rules under which it would take place.

While the British telecom major has indicated its preference for conciliation under the United Nations Commission on International Trade Law (UNCITRAL), India has proposed settlement under the Indian Arbitration and Conciliation Act.

The Supreme Court last year had ruled in Vodafone's favour, saying the British company was not liable to pay any tax over its 2007 acquisition of mobile phone assets in India.

The government later that year changed the rules to enable it to make retroactive tax claims on already-concluded deals, drawing criticism from global business groups.

Following amendment to the I-T Act 1961 last year, the Income Tax Department had issued a letter in January to Vodafone International Holdings BV stating that the company is required to pay the tax.

Vodafone replied, saying that they do not owe anything to the Indian government. Vodafone earlier wanted to take India to international arbitration but later offered conciliation on the issue.

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