New Delhi, October 8: The Delhi High Court has asked the government whether it would challenge an international tribunal’s award in the Vodafone Group tax case that had held India’s tax department in breach of the India-Netherlands Bilateral Investment Treaty.
A division bench sought the clarification while hearing the government’s appeal against a single-judge bench’s order on the jurisdiction of another arbitration tribunal, The Economic Times reported.
In 2018, Vodafone had initiated the second arbitration proceeding under the India-UK Bilateral Investment Protection Agreement, over the tax imposed on it for its $11 billion acquisition of the Indian assets of Hutchison in 2007.
The government moved the high court against this second arbitration, but its petition was rejected. It then appealed before the division bench, which took up the plea on Wednesday. The court will hear the case next on November 17, people aware of the proceedings said.
The matter came up for hearing after the Permanent Court of Arbitration in The Hague had ruled in favour of the Vodafone Group and held that the Indian tax department’s demand was based on a retrospective amendment to the tax law and was in violation of the India-Netherlands agreement.