IBM, Nokia Oyj, Microsoft cases could now be resolved
The order in favour of Vodafone is being considered significant because some domestic companies too are involved in similar transfer pricing cases.
The government will have to make substantial payments, as well as forego revenues in FY'23, if it wants to work on the survival of Vodafone Idea because it will have to extend the same incentives to the entire telecom sector. According to estimates, the industry has to spend around Rs 21,000-Rs 25,000 crore for spectrum which it bought on a deferred payment basis. Vodafone Idea has asked for a moratorium for another year (FY23). If granted, the government will have foregone the instalment payout for a third year in a row as it has already provided a moratorium for two years, giving telcos Rs 42,000 crore worth of relief.
Bharti Airtel and Vodafone Idea will roll out revised mobile service tariffs increasing rates in the range of 10-24 per cent from the first week of July. Bharti Airtel announced a 10-21 per cent hike in prepaid and postpaid mobile tariffs from July 3, a day after larger rival Reliance Jio announced an increase in rates. Later in the day, loss-making telecom operator Vodafone Idea (Vi) also announced its plan to raise mobile tariffs by 11-24 per cent from July 4.
To decide whether capital gains on surrender of call options are taxable
Vodafone wrote to the government proposing conciliation.
Transfer pricing tax orders of Income Tax against Shell and Vodafone pertain to alleged undervaluation of shares issued by their domestic subsidiaries to the parent companies abroad.
The British mobile phone operator was widely expected to go for an international arbitration after its talks with the Indian government failed to find a solution last year.
The Ruias and other promoters own a 99.99 per cent stake through various companies in BPL Mobile Communications. They have already toned it down to 82.4 per cent, sources close to the development said. Now, the group is looking at further bringing it down to less than 70 per cent. This will make BPL Mobile Communications a shell company and diminish its values making its shares 'worthless,' says Vodafone.
Wooing overseas investors, government on Wednesday decided against challenging the Bombay High Court decision favouring Vodafone in the Rs 3,200 crore (Rs 32 billion) tax case and adopt a similar approach in transfer pricing litigations involving other MNCs like Shell.
A court ruled in favour of Vodafone on Friday in a long-running dispute with the Indian taxman, a boost for the British telecom group whose tax battles have been seen as emblematic of the troubles facing foreign investors in India.
Firms come out with detailed communiqu for consumers that counter Jio's claims of cheap data
All the three companies, which dominate India's mobile services market with about 53 per cent share, have reduced the quantum of Internet download and/or validity periods on various packages they were offering, as per their websites.
This fresh case pertains to the tax assessment done by the I-T department for the year 2009-10.
Vodafone too has undervaluing its shares by Rs 1,308.91 crore.
The I-T department had said Vodafone India under-priced shares in a rights issue to its parent. The tax demand was for the two financial years ended March 2011.
The chief of the British telco's Indian subsidiary, which is the second largest cellular operator in India, also said the recent decisions by telecom authorities have disappointed the sector.
On Wednesday, in a significant ruling that may result in $2 billion (Rs 10,000 crore) flowing into government coffers, the Bombay high court had dismissed a writ petition filed by telecom major Vodafone International Holdings BV challenging the Income Tax (I-T) Department's jurisdiction to assess whether the over $11 billion Hutchison-Vodafone transaction was liable for capital gains tax.
Besides Vodafone, several other major MNCs like Nokia and Shell were locked in tax dispute with the revenue department.
Jaitley sets condition of 50% assets for applicability of capital gain tax.
SC said 10 per cent of the amount would have to be paid by March 31.
The Union finance ministry has asked field officers of the income tax department to not be adversarial to assessees, and to not send high-pitched demands without a proper basis.
The company has made payment in compliance with Telecom Department's instructions for self assessment, Mittal said, adding that the Supreme Court had not mentioned specific amounts.
APAs are part of govt's aim to move to a non-adversarial tax regime.
The retrospective tax controversy was highlighted by Vodafone, but Cairn Plc's continuing problems point to the impact this law has had on FDI in India's oil and gas sector.
While Vodafone will hold 45.1% of the shares in the new entity, to be renamed at a later stage, Kumar Mangalam Birla and other promoters of Idea group will hold 26%. Vodafone India will also transfer 4.9% of its shareholding to Idea's promoters for a cash consideration of Rs 38.74 lakh crores.
Budget may allow use of advance-pricing agreements for past cases.
Apex telecom industry body COAI has asserted that spectrum pricing should be kept conducive to market conditions as 5G entails upfront capital investments with monetisation spread over a long-haul, and pricing radiowaves high will only push the players up against the wall. The stage is set for Telecom Regulatory Authority of India (TRAI) to come out with its recommendations on 5G spectrum pricing and other modalities for upcoming auctions, and the announcement from the sector watchdog is expected anytime now. Norms will also be worked out for new frequencies such as 526-698 MHz and millimetre band, that is 24.25 - 28.5 GHz, in addition to bands such as 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300-3670 MHz.
Here's how 250 tax sleuths are taking on corporate titans.
Chanda Kochhar, managing director of ICICI Bank, says the new government must take effective action bringing clarity around tax laws.
Bidding for the sixth round of spectrum auction for radiowaves worth Rs 3.92 lakh crore will start from March 1, according to a notice issued by the Department of Telecom on Wednesday. The long-awaited spectrum auction is being held after a gap of four years and over two years after the Telecom Regulatory Authority of India (Trai) calculated and recommended base price for the radiowaves. The DoT has fixed January 12 for the pre-bid conference and January 28 as the last date for seeking clarification to the notice.
Idea may have to shell out Rs 4,500 crore in cash
Top management of firms should be summoned for a few specified reasons and after written justification at a senior level.
India is crucial for Nokia's attempt to hold on to global market share.
In a setback to telecom service providers, the Supreme Court on Thursday allowed the Centre's plea to recover adjusted gross revenue (AGR) of about Rs 92,000 crore from them.
Only 300 assessees came forward with disputed tax liabilities amounting to Rs 10,000 crore
US-based technology major IBM is contesting a claim of the revenue department which has increased the company's taxable income substantially to around Rs 11,000 crore (Rs 110 billion).
Cairn files notice against India in $1.6 billion tax dispute.
Irrespective of demonetisation and GST blues, IIM Lucknow has been able to successfully place their batch of 459 students.
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Cairn India said it has always been fully compliant with all Indian income tax laws.
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