Vodafone case isn’t the end, clarifies Telecom Minister

The Vodafone tax issue, having triggered a lot of turbulence among the corporate, has been hinted by the Telecom Minister Ravi Shankar Prasad as the case with alternative options to solve.

In a Press Trust of India (PTI) report, the minister was quoted saying, "I know taxing is a problem. Let me make an observation on this, taxing scenario of India should not begin with and end with Vodafone (tax case), I know that Vodafone issue could had been handled differently.”

Vodafone has been imposed a tax liability of over Rs 11,200 crore, along with interest, on its 2007 acquisition of Hong Kong-based Hutchison Whampoa's stake in India's telecom major, Hutchison Essar.

PTI has further quoted Prasad who said, “On a second tax dispute involving Vodafone, the government has decided not to appeal in a higher court after the telecom firm won the case in Bombay High Court.”

The Vodafone case involves a tax liability of Rs 3,200 crore , which the Supreme Court said private companies cannot use ‘corporate veil’ to avoid taxations.

"We are very clear that the taxing regime has to be stable and predictable but those who do businesses also need to understand they are obliged to pay tax," Prasad said clearing the confusion of government backing the corporate.

(Image: Reuters)

Prasad has made it clear that whole debate on taxing scenario should not revolve around just Vodafone and therefore this kind of a campaign that Vodafone case is the end, is not right.