While Vodafone has shown unwillingness for conciliation under Indian law to solve its tax dispute, the firm wants further talks with the government to reach a solution, reports Santosh Tiwari in New Delhi.
Sources close to the development, told FE that in its response to the government's offer for a reconciliation after cabinet's approval, Vodafone has asked for further consultations. The finance ministry is now figuring out how the talks could be continued and who will talk to the Vodafone representatives. The cabinet approved a framework for solving the dispute and the government will explore all available options, said a source.
Decks were cleared by the cabinet in June for a conciliation between the income-tax department and Vodafone over the disputed Rs 1,200-crore tax demand, which could go up to Rs 19,500 crore, including penalties and interest payments, arising out of its $11-billion purchase of Hutchisonís India operations in 2007. Vodafone's problem is that once it agrees for a reconciliation under the Indian law, there is a possibility of the company losing the advantage that it has because of the Supreme Court's ruling against the I-T department in the case.