New Delhi: The government will refund over Rs 8,000 crore to four companies, including Cairn Energy and Vodafone, after the Taxation Laws (Amendment) Bill 2021 becomes a law, CBDT Chairperson JB Mohapatra has said.
The Taxation Laws (Amendment) Bill 2021 was passed in Rajya Sabha on Monday. The bill proposes amendments to the Income Tax Act, 1961 and does away with the contentious practice of retrospective tax.
It states that “no tax demand shall be raised in future on the basis of the said retrospective amendment for any indirect transfer of Indian assets if the transaction was undertaken before May 28, 2012.”. This is the date on which the Finance Bill, 2012 had received the assent of the President of India.
“As far (as)I know, there are four cases. Apart from Cairn Energy, three other cases are WNS capital, Vodafone and there is one more case. So, in total, in excess of Rs 8,000 crores will be paid out by way of refund and the refund will be without any interest,” Mohapatra told news agency ANI.
He said the bill is likely to become a law next week. After being cleared by the Rajya Sabha, it will come back to Lok Sabha for confirmation and then go to Ministry of Law for notification.
“The statement of the Finance Minister says about 17 cases, in which four cases where demands have been paid as a part and those are the four cases where demands have been paid. There are other 13 cases where demands have been raised, but they have not yet been discovered. So it will be a simple refund to be given by the Income Tax department for the payments they have made, they will be refunded in terms of the amendment which has been brought through as and when it is passed, and given assent by the President and becomes law,” the chairperson said.
The bill was introduced after India lost retrospective tax demand cases against Cairn Energy Plc. and Vodafone. The Centre had challenged the verdict in both these cases, however, the continued existence of retrospective taxation had raised many questions within the country. The passing of the bill is expected to have a huge impact on these cases.
The move has been welcomed by several businesses and economists as it supports recovery of the economy by attracting investments.
(Inputs from BT)
