Government's 13k crore notice to Vodafone imminent

With the Finance Minister, Pranab Mukherjee abandoning the idea of dropping the proposal that would amend the law to impose capital gains tax on merger and acquisitions that involve foreign companies having assets or shares in the country, a 13,000-crore demand by the I-T department now awaits Vodafone, reports Times of India. It further adds that on receiving an approval by the President to the Budget, a notice will be served to the company. According to the tax department, the notice is ready at the moment and is only awaiting the approval of the Budget by the President. It will include the interest on the 7,900 crore that is due from the transaction between Vodafone and Hutchison, wherein the former acquired the latter's 67 percent interest in the Indian telecom venture. The report adds, "While the move will come as a setback not just for Vodafone but nearly a dozen other companies, it may trigger a fresh round of litigation with the telecom giant threatening to invoke the provisions of the India-Netherlands investment treaty." Click here for full story