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Kolkata kisses goodbye to Ambi? LANCO opens negotiations with buyers for Karnataka power plant Hyundai Grand i10 awaiting launch While MoTown is on a tailspin, the telecom sector is staging a rally Urja Sangam in Delhi Vodafone to buy out minority shareholders Singapore Airlines prefers Airbus Automobile sector in slump... Infosys not to cut prices Latin America beckons India for investments GMR to raise US $ 250 mn thru QIP Carlyle invests in Trehan’s Medanta Medical Centre Lanco to sell Australian acquisition TCS, India’s biggest block buster Capital Notes Excise duty may halt the war in SUV market Aircraft lessors to get protection from defaulting airlines Jet-Etihad Rs 2000 plus crore deal to be cleared Smartphone prices may change Canada screams over IT outsourcing to India Trends point to a hung assembly ONGC to draw down on reserves to meet CAPEX needs German envoy Steiner caps a language row Hunt for new finance secretary on... Vodafone slapped with tax notice of Rs 3700 crore Airlines hit by service tax on lease How important is Modi’s German visit... Flipkart India in the red by Rs 280 crore Renault revving up small car launch Plans to double trade with Latin America TVS bullish on the two wheeler market? Fox Star Studios to tie-up with Bolly-wood and Kollywood Wal-Mart studying FDI norms post split with Bharti SpiceJet in the news again
 
Vodafone slapped with tax notice of Rs 3700 crore

Like the phoenix rising from the ashes, Vodafone India’s taxation problems have once again risen. Income Tax authorities have slapped Rs 3700 crore tax notice as their liability to pay to the authorities on transfer pricing from the sales of shares by its local subsidiary. Vodafone India has been asked to clear the tax within 30 days or face penal action. Vodafone has hit back saying it will contest it in courts. Only last month the Bombay High Court had ruled that the tax department’s dispute resolution panel should quickly decide on the transfer pricing tax case of Vodafone. DRP is now considered as the alternative mechanism to settle tax disputes arising from transfer pricing. Transfer pricing is a practice where transactions are priced between a group’s companies based in different countries.

    The case relates to transfer pricing order for assessment year 2008-09 over the sales of shares by the UK company’s local units, Vodafone India Services Pvt Ltd, to a Mauritius based group. Vodafone sold shares to the Mauritius Company for Rs 246 crore at a value of Rs 8519 per share. The Tax department has, however, determined the value of the shares at Rs 53,775 per share. The difference is being sought to be taxed by the Income Tax authorities’ as income in the hands of the tele services provider. The original tax demand against the firm was just around Rs 400 crore.

 

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