New Delhi, Nov.15 (ANI): The Supreme Court on Monday directed telecom company Vodafone to deposit rupees 2,500 crore in three weeks and a bank guarantee of rupees 8500 crore in eight weeks.
The Supreme Court's ruling came out in the ongoing case in which the UK based telecom giant challenged capital gains tax of rupees 11,000 crore from its acquisition of Hutchison shares.
The bench headed by Chief Justice S.H. Kapadia, justice K.S. Radhakrishnan and justice Swatanter Kumar, also held that if the case goes in favour of Vodafone then the government will have to return the amount to the telecom giant along with interest.
The apex court also directed the Director General of international taxation to file an undertaking before the court that the government would refund the amount along with the interest to Vodafone if the UK based telecom giant succeeds in the case.
The apex court would start its final hearing in this matter from February 5, 2011.
Earlier on October 25,the Supreme Court adjourned the hearing after Vodafone sought time to go through its tax notice sent by the IT department and to file its reply.
Following the instructions of the apex court, the Tax Deducted at Source (TDS) officials of the Income Tax department had fixed Vodafone's liability on the overseas transaction.
The department held Vodafone liable for not deducting tax at source on capital gains accruing to Hutchison and claimed over rupees 11,000 crore in tax and as a penalty on the 2007 deal.
Hutchison's telecom business in India comprised a substantial chunk of its overall business and the deal enabled Vodafone to enter the Indian market in a big way.( (ANI)