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Rules to settle retrospective tax disputes may come this week: Report

The Parliament has passed the Taxation Laws (Amendment) Bill, 2021, which withdrew the retrospective tax clause that was added in 2012.

September 13, 2021 / 10:47 AM IST
The Parliament had in August passed the Taxation Laws (Amendment) Bill, 2021, which withdrew the retrospective tax clause that was added in 2012.

The Parliament had in August passed the Taxation Laws (Amendment) Bill, 2021, which withdrew the retrospective tax clause that was added in 2012.

The Centre may issue rules on settling retrospective tax disputes this week after assessing feedback from companies on the draft norms.

Once the rules are notified, the government is hopeful that some cases might be settled in the next six-eight weeks, The Economic Times has reported.

"Rules are being firmed up after comments from stakeholders…These should be announced soon," an official told the publication.

Also read: 'Repealing retrospective tax a reformist and pragmatic move by govt, but alone is not enough to attract foreign money'

Moneycontrol could not independently verify the story.

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The Parliament had in August passed the Taxation Laws (Amendment) Bill, 2021, which withdrew the retrospective tax clause that was added in 2012.

According to the draft rules, companies will have to indemnify the government against any future claim and drop existing litigation.

Under the amendment, the government will refund the amount collected as retrospective tax without interest. The companies will also have to give an undertaking that they will not seek costs, damages, or interest.

UK-based Cairn Energy has agreed to drop litigation to seize Indian assets abroad, in exchange for a $1 billion refund in the tax dispute, PTI reported on September 7.

Cairn CEO Simon Thomson told the news agency that such an offer by the government was "acceptable” to them.

"Everything will be dropped. There will be no more litigation, that will be it. It will clear the matter up," he said.
first published: Sep 13, 2021 10:47 am

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