Indian court turns down Vodafone plea

In a major setback to Vodafone, the Indian Supreme Court on Friday refused relief to the telecom major in the tax claim case of about US$2 billion, asking it to respond to the I-T authorities' showcause notice.
Vodafone, the Netherlands-based company, had bought a 67 per cent stake in Hutchison Essar from Hutchison Telecom International (HTIL) in February 2007 for $11.2 billion.
The IT department had served showcause notice on the telecom firm on 19 September 2007, asking it why it should not pay $1.7 billion as capital gains tax for its acquisition of stake in Hutchison Essar (now Vodafone Essar).
A Bench comprising Justice SB Sinha and Justice MK Sharma refused to hear the plea that challenged the Bombay High Court judgment, which on 3 December last year had dismissed a petition by Vodafone International Holdings BV contesting a showcause notice by the I-T department.