On Vodafone ruling, father-son Bhushans don’t see eye to eyeMarch 23rd, 2012 - 7:37 pm ICT by IANS
New Delhi, March 23 (IANS) On civil society issues, they are part of the same movement and platform. But on the Vodafone tax ruling, the Bhushans, Shanti and Prashant, don’t seem to see eye to eye.
“Dissenters like Prashant Bhushan have misunderstood the facts,” says the senior Bhushan in a signed op-ed article in the Indian Express referring to the Supreme Court ruling that set aside the $2.2 billion tax claim on Vodafone for acquisition of shares in telecom firm Hutch-Essar.
The younger Bhushan, as also the Bombay High Court, had held that since the object of the deal was to get indirect control over the Indian company, it should have been seen as a move to avoid payment of capital gains tax amounting to Rs.12,000 crore.
“This reasoning is totally fallacious and has no support in law,” Shanti Bhushan said in the article, while emphasising that there was also no basis to suggestions that Chief Justice S.H. Kapadia should have recused himself.
According to him, the corporate structure of Hutchison Group and the incorporation of the holding company of the Indian entity in 1998 — CGP Investment Holdings BV, with a base in The Netherlands and Caymen Islands — was clearly not the purpose of the deal.
He says the Supreme Court was correct in assessing this information, also the fact that the Indian entity had, indeed, been paying income tax between 2002-03 and 2010-11 which amounted to Rs.20,242 crore ($45 billion) during those eight years.
Prashant Bhushan had said in his article in a magazine that the Supreme Court ruling to set aside the Bombay High Court verdict would mean that many foreign companies can also avoid paying tax in the future.
“Lakhs of crores of rupees of tax revenue of this country and the future attitude of the courts towards innovative tax avoidance devices being adopted more and more by international corporations would be shaped by these two judgments,” he wrote.
In the national budget for 2012-13, presented in Lok Sabha last week, Finance Minister Pranab Mukherjee had sought to plug this loophole with provisions that would also have retrospective effect.
As regards the chief justice, Shanti Bhushan said the writ petition suggesting Justice Kapadia should have recused himself from the case was rightly set aside by a bench of Justice Aftab Alam.
“In my opinion, there could not be a more atrocious suggestion,” said the senior Bhushan and said no reasonable person can conclude in any way that the chief justice would not be dispassionate in hearing and deciding on the case.
- Government seeks review of Supreme Court's Vodafone verdict - Feb 17, 2012
- Government seeks review of Supreme Court's Vodafone verdict (Lead) - Feb 18, 2012
- Vodafone needn't pay tax for Hutch acquisition: Supreme Court - Jan 20, 2012
- Government plea on Vodafone tax verdict dismissed (Second Lead) - Mar 20, 2012
- Government's plea for Vodafone verdict review dismissed (Lead) - Mar 20, 2012
- India's apex court saves Vodafone $2.2-bn tax burden (Roundup) - Jan 20, 2012
- Supreme Court dismisses petition in Vodafone case - Mar 02, 2012
- Apex court dismisses lawyer's petition in Vodafone case (Lead) - Mar 02, 2012
- Nothing colourable in takeover, Vodafone tells apex court - Aug 03, 2011
- Prashant Bhushan refuses to apologise for comment on chief justice - Jan 13, 2011
- I-T authorities can dissect any takeover deal: Apex court - Aug 04, 2011
- Nothing colourable in takeover, Vodafone tells apex court (Lead) - Aug 03, 2011
- Vodafone welcomes apex court's decision in tax case - Jan 20, 2012
- No apology for remark on chief justice: Prashant Bhushan (Lead) - Jan 13, 2011
- Shanti Bhushan moves contempt proceeding against Amar Singh (Lead) - Apr 18, 2011
Tags: bhushan, bombay high court, capital gains tax, caymen islands, cgp, court verdict, crores, ed article, hutch essar, hutchison group, indirect control, international corporations, investment holdings, kapadia, lakhs, national budget, prashant, supreme court ruling, tax avoidance, telecom firm