Vodafone International Holdings BV v Union of India and another
The Vodafone case is extremely vast and the facts are very extensive. It is one of the landmark cases brought before the Supreme court of India that discusses Indian Taxation and deals with the scenario where capital gains arising out of transfering of shares from a foreign holding company to another international firm. The capital gains in these cases would be those that are arising out of the benefits the company achieves with its Indian based subsidy. The main question is if such transactions are to be taxed by in the Indian tax system. To understand the facts without getting lost in the immensity of the happenings, following is the series of facts that present a more concise yet thorough chain of events.
• Hutchison Group of companies had taken certain interests in the Indian telecom sector by investing n Hutchison Essar Ltd (HEL) in 1992. Hutchison had an offshoot listed in Hong Kong and that had been incorporated in the Cayman Islands in 2004. This offshoot was HTIL.
• Vodafone acquired approximately 67% of interest in HEL from HTIL. Vodafone and HTIL entered into a Share Purchase Agreement in February, 2007, where HTIL agreed to transfer the share capital of CGP without any encumbrances and with all the rights attached or accruing out of them.
• Essar Teleholding Limited (ETL), HTIL, Essar Communications (India) Limited (ECIL), Essar Communication Limited (ECL), Essar Tele Investments Limited (ETIL), signed a settlement agreement in May, 2007, regarding Essar Group's support for completion of the proposed transaction and agreement not to sue any Hutchison Group Company etc., in lieu of payment by HTIL of US$ 373.5 million after completion and a further US...
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...rectification of the loophole. Capital gains arising out of any transaction that could accrue its profit from any work or investment in india should be taxable in india as provided by the later amendment. It in fact forced upon an speedy amendment as even though taxing such transaction was the intent of the government, the drafters, while making the act, couldn’t envisage such international transactions and therefore were unable to make laws accordingly.
This case has been one of the most published and looked at judgments in the recent times. It is one of the most sought after judgments in the field of taxation. The judgment although provided a clear and to the point understanding the law, it did not help the government in its intentions and did not help the revenue department implement their intent of making the transactions like that of the Vodafone taxable.
The failure of the Bureau of Indian Affairs to manage this trust fund properly led to legislation and lawsuits in the 1990s and early 2000s to force the government to properly account for the revenues collected. The aim of the act was to encourage American Indians to take up agriculture and adopt the habits of civilized life and ultimately.... ... middle of paper ... ...upon the survey of the lands so as to conform thereto; and patents. shall be issued to them for such lands in the manner and with the restrictions as provided herein.
"Barclays Capital Inc., Et Al. v. Theflyonthewall.com, Inc., No. 10-1372 (2d Cir. 2011)." Justia Law. N.p., n.d. Web. 22 Sept. 2015.
R v Secretary of State for Transport, ex parte Factortame Ltd and others [1999] All ER (D) 1173.
This case is an appeal against the decision of the High Court judge (“the Judge”) in Suit No 290 of 2011 (“Suit 290”) concerning an action in passing off ^([2]).
The court ridiculed the contrary arguments put forward by Intex in CCI and the High Court and also dismissed the arguments of the Intex with regards to Sections 8 and 64. It also rejected the arguments regarding the fact that the Ericsson had yet to establish the essentiality of its patents, and that this could only be established once the challenges to the same were addressed. Thus, all the arguments made by Intex were dismissed by the Court. It further ordered Intex to pay Ericsson 50% of the total royalty amount, as per total selling price per device, and not chipset, from the date of filing the suit within four weeks, and ordered that the rest of the amount be paid to the Court
Whatever the judgement of this case would be, it would for sure create a landmark with respect to income classification. It would be used as a precedent in numerous cases to come in future. Owing to the current scenario and the facts of the current case, the judgement went in favour of Vodafone, saving them a tax penalty that went into thousands of crores. Had the conditions and facts have been different, then there would have been a different outcome (maybe resulting in an amendment of the IT act also) , which might have given huge revenue to the IT department. This case highlighted the use of these tax havens, by particular shell companies either for investment or tax evasion, but however this case according to the SC was not classified to fall under tax evasion. The SC’s interpretation of the broad concept of ‘transfer of shares was also a highlight of this case. The request made by the IT department to treat the case retrospectively with the act before 1962’s amendment, was bogus. This case was treated as of utmost importance by the SC , because the outcome if this case would have a direct impact on the investment of various foreign MNC’s in the Indian market. Yes no doubt it cannot be denied that the IT department had acted in its authority and was only fighting this case to earn revenue for the government itself , but its action of appealing in the court repeatedly which led to arbitration shows the behaviour of the It authorities towards large holdings. Due to its loss in this case , now the department would do everything in its power not let any other company( that is actually no evading tax but investing) , escape small amount of tax.
The Mobile handset market was dominated by MNC’s like Nokia, Sony, Motorola and Samsung till 2008 when these MNC’s controlled more than 93% of the overall handset market. The high growth in this industry coupled with high profits prompted several players to enter into the market. Micromax was one such Indian player which entered into handset business in 2008.
By 2003, Indian mobile phone market has shown vast economic growth where they transformed the Indian telecommunications from Indian mobile operators using 2G(2nd generation) technologies which is GSM or CDMA to 2.5G and 3G technologies. By 2008, wireless market had US$10.9 billion in their pocket with 18% contributed by wireless services which peaked Indian phone market into higher level , after all they started with US$1.5 billion. Indian operators have different business strategy unlike American and European operators they sell mobile phones and mobile telephone services separately; business was partitioned with 60% prepaid services and 40% postpaid services. During 2003, Indian market was highly competitive; Bharti Airtel Limited is one of the leading Indian operators with other major competitors BSNL, Hutchinson, Reliance, Tata, Idea Cellular, and MTNL, but Bharti had operations in both the fixed and mobile segments.
An F/RAND pledge is interpreted as contractual obligations in Microsoft v. Motorola. The jury determined that Motorola breached its implied duty of good faith and fair dealing in seeking injunctive relief. A judge should follow the precedent of eBay Inc. v. MercExchange, L.L.C. of the Supreme Court of the United States and consider the logic of eBay in F/RAND-encumbered SEP cases. The eBay ruling disapproved the presumption of irreparable harm patent owners, and stressed the consideration of public interest when deciding to grant an injunction relief or not. The rule established in the eBay ruling would be instructive for F/RAND-encumbered SEP cases. Also, Court of Justice of the European Union (CJEU) issued its judgment in Huawei v. ZTE, setting out certain conditions for obtaining an injunctive relief for an SEP
The tribunal held that the “test is whether that inference is sufficiently restrictive to support a conclusion that the property has been “taken from its owner”. The tribunal considered the term “tantamount” contained in the expropriation clause and found that for a measure to qualify as indirect expropriation it must be equivalent to direct expropriation. The tribunal in the case of Tecmed v Mexico, held the State measure will be indirect expropriation if it is permanent and if the investor’s rights have been affected so that “any form of exploitation thereof … has disappeared”. In Telenor Mobile Communication A.S v Hungary, it was held that the investment should be viewed as a whole, and expropriation will occur if there has been a substantial erosion of value. The tribunal in Revere Copper found indirect expropriation had occurred by examining the “impact on effective control over use and operation” of the investor’s property. Formal ownership of the property was not affected, but the control of use and operation by the investor was no longer effective.
India is the second largest telecommunications market in the world with around 900 Million subscribers at present. Since its liberalization in 1994, the industry has seen considerable growth with enactment of different regimes and entry of new players. However, in the last few years, the industry has been affected by the constant regulatory disputes and intense business environment leading to price war.
Vodafone have 91% population coverage. Their strength is they are international recognition so people will believe that they have more experienced worldwide.
Hindustan Unilever Limited (HUL) is India's largest Fast Moving Consumer Goods Company with a heritage of over 80 years in India and touches the lives of two out of three Indians.
The Revenue Stamp (Raseedi Ticket): An Autobiography by Amrita Pritam; Translated by Krishna Gorowara; Published by Wide Canvas, an imprint of Vikas Publishing House Pvt. Ltd.
( 2013 , 2) .Salomon V Salomon & Co Ltd Researchomatic .Retrieved 2 , 2013, from http://www.researchomatic.com/Salomon-V-Salomon-And-Co-Ltd-153863.ht intro