All material subject to strictly enforced copyright laws. © 2022 ITR is part of the Euromoney Institutional Investor PLC group.

Everything you need to know about tomorrow’s Vodafone ruling

vodafonelogo.jpg

India’s Supreme Court will tomorrow issue its ruling on whether Vodafone is to pay $2.5 billion in tax to the Indian government. Here is everything you need to know to prepare for the decision.

10 things to look out for in the Vodafone rulingA list of 10 things to watch out for in the judgment, which is likely to be lengthy, comprehensive and where each word will be put under the microscope.

What to expect from the Chief Justice of IndiaMohan Parasaran, senior advocate and additional solicitor general of India provides an insight into the work of Chief Justice Kapadia and explains why the whole tax world is waiting for his judgment tomorrow.


HOW THE SC HEARING UNFOLDED

Vodafone SC hearing: Week 10Ten weeks after the case began, the hearing ended with Chief Justice Kapadia briefly toy with idea of referring the case to a larger bench to reconcile the conflicting principles laid down in McDowell and Azadi Bachao.

Vodafone SC hearing: Week 9Week nine of the Supreme Court hearing saw the Solicitor General complete his arguments by forcefully reiterating that the Cayman Islands structure was an “artificial tax avoidance scheme”.

Vodafone SC hearing: Week 8Week eight of the Supreme Court hearing saw the tax department begin their arguments by claiming that the sale of the share from the Cayman Islands company was nothing but an “artificial tax avoidance scheme”.

Vodafone SC hearing: Week 7Week seven of the Supreme Court hearing saw Vodafone’s counsel conclude his case by arguing that section 195 of the Income Tax Act cannot be applicable to taxpayers who do not have any presence in the country.

Vodafone SC hearing: Week 6Week six of the Supreme Court hearing revolved around the issue of whether the matter should be examined based on Indian law or whether foreign cases should also be considered.

Vodafone SC hearing: Week 5Week five of the Supreme Court hearing saw Chief Justice Kapadia delving into the powers of a holding company to dictate terms to a subsidiary.

Vodafone SC hearing: Week 4Week four of the Supreme Court hearing saw Vodafone’s counsel continue his argument that if the company is to be targeted then the corporate veil of all Indian operating subsidiaries would need to be lifted.

Vodafone SC hearing: Week 3The sixth and seventh days of the Supreme Court hearing of India hearing into the claim for capital gains tax against Vodafone arising from its purchase in 2007 of a 67% stake in Hutchison Essar saw the company continuing to defend the structure of the transaction and argue that it had no motive to evade Indian tax.

Vodafone SC hearing: Week 2Vodafone continued to defend its tax position by claiming that there was nothing wrong in using tax saving routes and it was a common practice among multinational companies.

Vodafone SC hearing: Week 1Vodafone’s much-anticipated India Supreme Court hearing started with a bang with a lengthy argument by the telecommunications company criticising the country’s tax authority.

more across site & bottom lb ros

More from across our site

The UN may be set to assume a global role in tax policy that would rival the OECD, while automakers lobby the US to change its tax rules on Chinese materials.
Companies including Valentino and EveryMatrix say the early adoption of EU public CbCR rules could boost transparency of local and foreign MNEs, despite the short notice.
ITR invites tax firms, in-house teams, and tax professionals to make submissions for the 2023 ITR Tax Awards in Asia-Pacific, Europe Middle East & Africa, and the Americas.
Tax authorities and customs are failing multinationals by creating uncertainty with contradictory assessment and guidance, say in-house tax directors.
The CJEU said the General Court erred in law when it ruled that both companies benefitted from Italian state aid.
An OECD report reveals multinationals have continued to shift profits to low-tax jurisdictions, reinforcing the case for strong multilateral action in response.
The UK government announced plans to increase taxes on oil and gas profits, while the Irish government considers its next move on tax reform.
War and COVID have highlighted companies’ unpreparedness to deal with sudden geo-political changes, say TP specialists.
A source who has seen the draft law said it brings clarity on intangibles and other areas of TP including tax planning.
Tax consultants say companies must not ignore financial transactions in their TP policies as authorities, particularly in the UK, become more demanding.