With British telecom major Vodafone being entangled in a tax dispute, Britain today asked India to provide a stable taxation regime and said it is looking for "good" outcome from courts.
Emerging from a meeting with Commerce Minister Anand Sharma, UK Business Secretary Vince Cable when asked about his views on Vodafone issue said, "We have talked about it, but it is a matter for the courts in the first instance.
"I think, simply to acknowledge Vodafone is an important company in India, that joint venture is one of the most rapidly growing and like other foreign investors, they need to have stability in the tax regime. We discussed this in a very amicable way. I think we look forward to a good outcome."
Vodafone is contesting over Rs 11,200-crore tax claim by the income tax department. The case relates to Vodafone's purchase of 67 per cent of Hong Kong-based Hutchison's stake in Hutchison Essar for $11.2-billion through a Cayman Islands entity in 2007.
The transaction took place between Vodafone International Holdings BV of Netherlands and Hutchison Telecommunications International.
Indian taxmen contended that Vodafone owed taxes from the purchase and the matter is now before the country's Supreme Court.
Vodafone has consistently maintained that it does not need to pay any tax as the transaction took place between two overseas companies and the Indian tax department has no jurisdiction over transactions such as the one it effected.
India's Income Tax department, however, contends that that Vodafone owes the Indian Government taxes to the tune of over Rs 11,200-crore.
In November last year, the Supreme Court had directed Vodafone, which is contesting the tax demand to deposit Rs 2,500 crore, along with a bank guarantee of Rs 8,500 crore, before it within eight weeks for adjudication of its suit.
