Vodafone redux

Vodafone’s fresh notice to the Centre seeking international arbitration over a ₹20,000-crore tax demand relating to its acquisition of Hutchison Essar’s telecom business in India speaks very poorly of the latter’s ability to resolve commercial disputes through conciliation. The dispute itself was avoidable in the first place. True, the $11.1 billion dollar Vodafone-Hutchison deal in 2007 did result in transfer of real assets in India. The capital gains from this, in normal circumstances, would have been taxed.

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