Vodafone Wins Rs 20,000 Crore Tax Arbitration Case Against Government

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Vodafone approached the Singapore International Arbitration Center in 2016 regarding the dispute

New Delhi:

Telecoms giant Vodafone said on Friday it had secured an important ruling against the Indian government in an international tribunal in Singapore for 12,000 crore rupees in interest and 7,900 crore in penalties.

Vodafone had taken the court in 2016 in the litigation which arises from a retroactive tax request for the use of the airwaves and the rights of license.

The court ruled that the Indian government’s imposition of a tax liability on Vodafone was in violation of the investment treaty agreement between India and the Netherlands, company sources told Reuters news agency.

The heavily indebted telecommunications company was granted a stay earlier this month as the Supreme Court gave mobile operators 10 years to settle government dues, but the company’s long-term problems are not over.

India’s telecommunications providers must pay the Department of Telecommunications nearly 3-5 percent of their adjusted gross revenue (AGR) in airwave usage fees and 8 percent of AGR in license fees. They have long challenged the definition of AGR, but last year the Supreme Court upheld the government’s view that AGR should include all income.

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