India has challenged in Singapore an international arbitration court’s verdict against it over a $2 billion tax claim involving Vodafone Group Plc, a senior government official said on Thursday on condition of anonymity.
Vodafone in September had won the case against India, ending one of the most high-profile disputes in the country that had caused concern among investors over retrospective tax claims on companies.
An international arbitration tribunal in the Hague ruled that India’s imposition of tax liability on Vodafone was in a breach of an investment treaty agreement between India and the Netherlands. India had 90 days to appeal the ruling.
The appeal was filed in a Singapore court earlier this week, the Press Trust of India reported, citing two people privy to the development.
The government believes taxation is not covered under investment protection treaties and the law on taxation is a sovereign right of the country, PTI reported, citing the two people mentioned above. The finance ministry did not immediately reply to an email and message seeking comment on the story. Vodafone Group declined to comment on the issue.
India lost another international arbitration case this week, against Cairn Energy, over a tax dispute. It has been ordered to pay the UK-listed company over $1.2 billion in damages and costs.
India is expected to challenge this ruling, too, given the size of the award, said the senior government official, who did not want to be named as the decision was not public yet.
India has faced a string of arbitrations by investors including Deutsche Telekom and Nissan Motor Co over issues ranging from retrospective taxation to payment rows.
