India Tax Authorities Examining Previous M&A Deals After Vodafone Ruling
India said it’s examining acquisition deals over taxes after a court last week ruled the government is entitled to seek duties from Vodafone Group Plc.
“We are looking into other cross-border transactions also,” said S.S.N. Moorthy, chairman of the Central Board of Direct Taxes told reporters in New Delhi yesterday. “Most of them are small transactions,” he said, declining to elaborate.
The Bombay High Court on Sept. 8 ruled Indian tax authorities have the jurisdiction to seek more than $2 billion in taxes from Vodafone International Holdings BV on its 2007 purchase of Hutchison Whampoa Ltd.’s wireless operations in the country. India’s tax department has said the world’s biggest mobile-phone company failed to withhold taxes on its acquisition of Hutchison’s stake in Hutchison Essar Ltd., or HEL.
Vodafone is likely to appeal the verdict, Ben Padovan, a spokesman at Vodafone, said at the time. The court told tax authorities not to issue a final order on its claim for eight weeks and gave Vodafone 12 weeks to appeal the ruling.
Vodafone announced the $10.7 billion acquisition of a 67 percent stake in Hutchison Essar in 2007. Pending legal cases involve companies including Mitsui & Co., SABMiller Plc and General Electric Co., the Financial Times reported today.
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