Essar Tele to seek $886m tax refund from taxman: Sources

Posted on January 30, 2012. Filed under: Uncategorized |

Taking a cue from the recent landmark decision, Essar Tele is seeking a USD 886 million tax refund from the Income Tax department, reports CNBC-TV18's Siddharth Zarabi.

Vodafone had deducted USD 886 million from the payment to Essar in mid-2011 on the payment of USD 3.8 billion.

Sources say Essar is seeing legal recourse on the refund claim following the Supreme Court verdict on Vodafone case.

The SC has set aside the Bombay High Court ruling and asked the Income Tax Department to return Rs 2,500 crore deposited by Vodafone International Holdings within two months along with 4% interest.

The apex court also asked its registry to return within four weeks, the bank guarantee of Rs 8,500 crore given by the telecom major. The apex court held that the IT department has “no jurisdiction” to levy tax on overseas transactions between companies incorporated outside India.

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