I-T department has fixed Rs 12,000-crore tax claim on the 2007 deal in which Vodafone bought Hutch's 67 per cent stake in Hutchison Essar for $11.2 billion.
Cash-strapped telco Vodafone Idea's proposal for investment of up to Rs 15,000 crore through foreign direct investment (FDI) has been approved by the Union government, according to officials. A top-level group, comprising representatives from the ministries of home affairs, external affairs, finance and commerce and industry, took the decision. The nod, which is an enabling provision, would help the financially-stressed company raise funds to pay up some of its dues linked to adjusted gross revenue (AGR), reduce debts and use the money for operational expenses.
Officials say telco still keen on process.
UK-based Vodafone is not the only one awaiting the Indian government's call on its purchase of stake in Hutch-Essar, US coffee retail giant Starbucks is also anxiously looking for a decision on the issue.
The first notice in the transaction relating to the sale of 67 per cent stake of Hutchison Essar Ltd was issued on March 15, 2007, under section 133(6) of the Income Tax Act.
The government may be waiting for the outcome of an arbitration initiated against its levy of Rs 10,247 crore retrospective tax on UK's Cairn Energy Plc before deciding on appealing against losing a tax case against Vodafone Group, sources said. An international arbitral tribunal is expected to give a decree within next few days on Cairn Energy Plc's challenge to the Indian government seeking Rs 10,247 crore in retrospective taxes. If the arbitration award in the Cairn cases goes against India, the government has to pay the British firm over Rs 7,600 crore to reverse the dividend and tax refund it had ceased and shares it sold to recover part of the tax demand.
The new partners have also agreed to change the Hutch brand in a period of eight months to a year.
Law ministry tells finance ministry to inquire into the acquisition of Hutchison-Essar further.
GSM industry's subscribers base has added 6.19 million users in January 2008, taking their total mobile subscriber base to 178.4 million.
The government on Friday cleared British telecom firm Vodafone's application for buying a majority stake in India's fourth-largest mobile operator Hutch-Essar Ltd.
The sale of Essar Oil was India's biggest deleveraging exercise undertaken by any debt-heavy group
This delay was a result of controversies over a 15 per cent holding by Hutchison-Essar Managing Director Asim Ghosh, healthcare major Max's Analjit Singh and financial institution IDFC.
The Income Tax deparment has sent a notice to Vodafone, seeking around $1.7 billion in capital gains tax related to the sale of Hutchison Telecom International Ltd's 67 per cent stake in Hutch-Essar, now renamed Vodafone-Essar.
Agency reports said Hutchison Whampoa had received bid interest in its Indian mobile business, but that the prices indicated so far were too low.
Hutchison Telecom International Limited, which recently sold its 67 per cent control in mobile service provider Hutchison Essar to Vodafone, has filed a caveat in the Bombay high court requesting that it be made a party to any suit by the Ruias.
Ruias have rights to tag along with Hutch in any sale.
A shareholder of Vodafone Group has urged the company to abandon its plans to acquire India's Hutch Essar, saying the British telecom giant could overpay for the deal, British daily The Times reported on Friday.
As Vodafone started examining the books of Hutchison Essar, its existing partner Bharti Airtel on Tuesday said it has not been approached by anyone to buyout British telecom firm's stake in the company.
Ambani to up ante by $3 bn on Ruia's hint at larger premium.
Britain's Vodafone, which acquired controlling stake in mobile firm Hutch-Essar, on Tuesday said it will transfer its 5.6 per cent stake in Bharti Airtel back to the Indian mobile leader by November next year.
Essar group is in talks with international bankers to raise about $5 billion (over Rs 20,000 crore) by leveraging its 33 per cent stake in Hutch-Essar, the country's fourth-largest mobile player in which UK's Vodafone recently acquired majority stake
The Department of Telecom, Department of Industrial Policy and Promotion, Ministry of Home Affairs, Ministry of External Affairs and the Department of Economic Affairs had to give their comments on the proposal, sources said.
A report in The Observer on Sunday said the bidding war for telecom firm Hutchison Essar will erupt again, with Britain's Vodafone preparing to table a fresh offer that would value the target at up to 19 billion dollars.
The world's largest mobile operator by revenue, Vodafone, which operates in India with a joint venture with Essar Group, on Monday said it will invest more in India as it sees more opportunities in the country.
The British teleco is bidding hard for cellular operator Hutchison Essar. At stake: the world's fastest growing mobile market-and Vodafone's reputation.
Shareholders of Hutchison Telecom would on May 8, vote on a proposal to pay Essar group $415 million to ensure smooth transaction with UK's Vodafone for sale of majority equity in Hutch-Essar.
Vodafone has rejected a restructuring call by an activist investor lobby that would have unlocked up to $75 billion to shareholders, saying such business strategies could have prevented it from recent acquisitions such as Hutch-Essar in India.
Ahead of Thursday's Foreign Investment Promotion Council meeting that would take up sale of stake in Hutch-Essar to Vodafone, the UK company's director Mathew Kirk met telecom secretary Dinesh Mathur on Wednesday.
British telecom giant Vodafone's plans to acquire India's fourth-largest mobile operator Hutch-Essar has received mixed reactions from some of its key shareholders.
Bharti Airtel will start talks for "disengagement" from its partner Vodafone once the UK company decides on its future course of action in India.
In the case, which will begin on Tuesday and last for five days, Indian tax authorities will argue that Vodafone, the UK-based mobile phone group headed by Arun Sarin, is liable for an estimated $2bn in taxes on its $11bn acquisition of local operator, Hutchison Essar, last year.
The exploration and production assets of Essar Oil will not be part of the Rosneft deal and would continue to remain with the Group.
Sources said I-T deparment has sent a notice to Vodafone for not paying capital gains tax, arguing that the company should have deducted tax at source while making payment to Hong Kong-based Hutchison Telecom International Ltd.
Delhi High Court quashes reassessment proceedings by Income Tax department.
UK's Vodafone is learnt to have approached the Foreign Investment Promotion Board for approval to acquire 52 per cent stake of Hong Kong-based Hutchison Telecom in mobile firm Hutch-Essar and also for investing in telecom activities.
British telecom giant Vodafone could face a downgrade in its credit rating by Standard and Poor's if its proposed bid for Hutchison Essar Ltd exceeds $19 billion, a media report said in London.
The Finance Ministry has already circulated a draft Cabinet note withdrawing the conciliation offer to Vodafone to resolve the Rs 20,000-crore (Rs 200-billion) tax dispute case.
Over the weekend, the Bombay high court quietly published a 160-page court order detailing its decision to dismiss a petition by Vodafone of the UK against the Indian tax department.
A landmark court challenge by Vodafone against Indian tax authorities, which want it to pay an estimated $2bn in taxes on its acquisition of Hutchison Essar, has been adjourned for three months. The Bombay high court delayed the hearing until June 23. It is a case that has potential implications for mergers and acquisitions of Indian assets by foreign companies. The court said it wanted to allow time for changes to tax laws to come into force.
UK telecom giant Vodafone has offloaded its 5.6 per cent direct stake in India's mobile leader Bharti Airtel to promoter Sunil Mittal's group for $1.6 billion, coinciding its acquisition of controlling stake in Hutch-Essar.
© 2026 Rediff.com - Investor Information - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances