Bombay HC ruled against ITAT order on Vodafone transfer pricing case

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Who: Vodafone tax issue
Where: Mumbai
What: Bombay high court ruled in favour of Vodafone
When: 8 October 2015

The Bombay high court on 8 October 2015 ruled against the Income Tax Appellate Tribunal (ITAT) order on 3700 crore rupees Vodafone transfer pricing case.

The verdict was delivered by High Court division bench of Justices S C Dharmadhikari and Anil Menon while hearing a petition filed by the Vodafone against the ITAT verdict.

The ITAT, in its earlier order, directed Vodafone to comply with the demand of 3700 crore rupees issued by the Income Tax (I-T) authorities

The tax demand dates back to 2007-2008 involving the sale of Vodafone India Services Private Ltd. (VISPL), the call centre business of Vodafone, to Hutchison.

As per the I-T authorities, the transaction attracts the provisions of capital gain tax; hence, Vodafone is liable to pay the tax.

However, the Vodafone challenged the order arguing that the sale of the call centre business was between two domestic companies; hence, the transfer pricing norms are not applicable to the deal.