India to appeal imposition of tax for New York property

March 21st, 2008 - 1:23 am ICT by admin  

New York, March 20 (IANS) India will appeal the decision of a US court that upheld imposition of $42.4 million tax on its property in New York. The appeal will be filed in a higher court within the stipulated one month’s time, a spokesperson of Permanent Mission of India (PMI) to United Nations told IANS Thursday.

The PMI building across the United Nations headquarters in mid Manhattan is being put to both official and diplomats’ residential use.

Judge Jed S. Rakoff of the US District Court in Manhattan ruled Monday that diplomatic privileges do not exempt a foreign country from tax obligations with the only exception being the residences of head of the mission and consul general.

The case was tried in the district court after the Supreme Court ruled on the jurisdiction which was contested by India under the Foreign Sovereign Immunities Act of 1976, which generally kept federal courts from hearing suits against foreign governments.

“The Supreme Court ruled only on the jurisdiction, not on the substance of our argument,” PMI’s spokesperson said.

India’s plea has been that under customary law and the Vienna Convention, premises of foreign missions are not liable to taxes.

Besides proceeding legally, India may also try to resolve the issue through talks with the US State Department, which too does not want to pay millions of dollars for its properties in other countries.

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