THE Supreme Court today simply dismissed the much-hyped USD two billion Vodafone capital gains tax case at the admission stage itself. Before rejecting the SLP, the Bench asked the assesee – why did they not furnish the copy of their original agreement to the Court and also to the Revenue? In reply the assessee spoke about their delayed offer and promised to make the same available any time.
Having heard the Senior Advocate, Mr Fali Nariman for the assessee, and the ASG, Mr Mohan Prasaran with Special Counsel, Mr G C Srivastava, the Apex Court directed the assessee to go back to the Assessing Officer, furnish all the necessary documents besides the copy of the Agreement, for deciding the issue of jurisdiction of the Indian Income Tax authorities and any other issues. If the assessee continues to have grievance over the issue of jurisdiction, they are free to move the High Court again.
What may be inferred from this dismissal which has already sent a wave of happiness among the Revenue circles across the country is the fact that for the first time, the issue of furnishing all documents irrespective of the confidential nature of an agreement and the same may have been signed outside India, reached the Apex Court stage and the SC has decided in favour of transparency. It has been seen in the cases of MNCs that they have shown reluctance to part with the language and wordings of billion-dollar agreements and Revenue deciding the same against them and the cases finally choking the appellate and judicial fora.
With a clear instruction being given to Vodafone today, other transnational entities may take a leaf out of this direction and should not be prepared to put all their cards on the table if they want to avoid litigation and a fair assessment.
