NEW DELHI (Alliance News) - An Indian court on Thursday ruled in favour of British telecoms giant Vodafone in an INR85 billion (USD1.3 billion) tax case, news reports and officials said.
The Bombay High Court passed the decision in the dispute involving the sale of a call centre and share options linked with Vodafone's 2007 acquisition of Indian mobile company Hutchison Essar, Mint business daily reported online.
Vodafone India confirmed the court decision. "Vodafone welcomes the decision by the Bombay High Court," spokesman Suresh Rangarajan said, adding details of the order were not available.
Transfer pricing refers to transactions between companies of the same group which are based in different countries.
Vodafone maintained that the transaction was not an international one and should not attract tax. It challenged a previous decision of a tax tribunal.
The 2007 deal is the basis of a bigger tax row between the British firm and Indian authorities amounting to more than 2 billion dollars, that is still to be resolved.
Prime Minister Narendra Modi's government has promised a stable and simple tax regime to remove hurdles connected with doing business in India in the backdrop of tax disputes with multinational companies.
Earlier this year, the Indian government said authorities will not appeal in another tax dispute case that went in Vodafone's favour. It said its move was a "major correction of a tax matter which has adversely affected investor sentiment".
Thursday's decision would be positively seen by multinational companies facing tax issues in Asia's third-biggest economy. There are more than two dozen such disputes in Indian courts, local media reported.
Copyright dpa
Vodafone (VOD)