Income Tax Demand of Rs.11,218 Crore Raised on Vodafone for failure to deduct tax as required under section 195

The Income Tax department today issued an order raising a tax demand of Rs.11,217.95 crore on Vodafone International Holdings BV treating it as an assessee in default under section 201(1) of the Income Tax Act, 1961 (the Act) for failure to deduct tax as required under section 195 of the Act before making a payment of US $ 11,076 million to Hutchinson Telecommunications International Limited. The tax demand is to be paid within 30 days of the receipt of the notice of demand.

The tax demand has been raised in pursuance to the direction of Hon’ble Supreme Court of India dated 27th September 2010 to the Income Tax Assessing Officer to determine and quantify the tax liability of Vodafone within four weeks.