Vodafone Case: Vodafone International Holdings BV vs. Union of India The Hutchison Group, Hong Kong (UK) invested into telecom business in India in 1992 under the name Hutchison Max Telecom Ltd. (HMTL) and later on it is renamed as Hutchison Essar Limited (HEL). HEL was an Indian Company in which Hutchison Group of Companies (which are incorporated in foreign countries generally Mauritius) acquired shares by the structural arrangement of holding and subsidiary companies. Hutchison Telecommunication International Ltd. (HTIL) which was incorporated in Cayman Island located in Western Caribbean Sea also held interest in telecom business in India. Another company namely CGP (incorporated in Mauritius) is the 100% subsidiary company of HTIL which had a controlling interest in HEL. Vodafone International Holdings BV was resident for tax purpose in Netherlands. A Sale Purchase Agreement (SPA) was signed between Vodafone International Holdings BV and HTIL in which HTIL agreed to transfer its entire issued share capital in CGP. Because CGP has controlling interest in HEL therefore it can be said that HTIL agreed to transfer its entire interest in HEL to Vodafone International Holdings VB. Now issue came up whether aforesaid transfer could be termed as indirect transfer of a capital asset and whether section 9(1)(i) would be attracted in such case or not. In this case High Court held that it is a case of indirect transfer of capital asset as per section 2(14) and held that Vodafone International Holdings VB had nexus (connection) with Indian Jurisdiction.
Posted on: Wed, 17 Jul 2013 05:33:03 +0000
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