India

Vodafone Wins Rs 20,000 Crore Tax Arbitration Case Against Government

Vodafone Wins Rs 20,000 Crore Tax Arbitration Case Against Government

Vodafone had approached the Singapore International Arbitration Centre in 2016 in the dispute

New Delhi:

Telecom giant Vodafone on Friday said it had won a significant ruling against the Indian government in an international court in Singapore over Rs 12,000 crore in interest and Rs 7,900 crore in penalties.

Vodafone had approached court in 2016 in the dispute that stems from a retroactive tax claim for using airwaves and in license fees.

The tribunal ruled that the Indian government's imposition of a tax liability on Vodafone is in breach of the investment treaty agreement between India and the Netherlands, company sources told news agency Reuters.

The heavily indebted telecoms firm had won some reprieve earlier this month as the Supreme Court gave mobile carriers 10 years to settle the government dues, but the company's longer-term problems are not over.

India's telecom providers have to pay the Department of Telecom nearly 3-5 per cent of their adjusted gross revenue (AGR) in usage charges for airwaves and 8 per cent of AGR as licence fees. They have long disputed the definition of AGR but last year the Supreme Court upheld the government's view that the AGR should include all revenue.