Mobile Services
India weighs legal options in Vodafone tax arbitration case
NEW DELHI: The government of India is weighing its legal options after losing the high-profile international tax arbitration case against Vodafone as it looks to limit damages not just in this matter but also in case of a separate lawsuit with Cairn Energy goes against it.
Last month, an international arbitration court ruled that the Indian government seeking Rs 22,100 crore in taxes from telecom giant Vodafone using retrospective legislation was in “breach of the guarantee of fair and equitable treatment” guaranteed under the bilateral investment protection pact between India and the Netherlands.
Finance Ministry sources said the government will decide on challenging the award before a court in Singapore – which was the seat of the arbitration, after taking legal opinion.
While the cost implication in the case is limited to having to pay Rs 85 crore to Vodafone in legal cost, what is weighing on the government mind is a separate arbitration involving UK’s Cairn Energy plc.
If a separate arbitration panel were to hold a demand for Rs 10,247 crore in taxes using the same retrospective legislation as illegal, the government will have to pay Cairn as much as USD 1.5 billion (Rs 11,000 crore).
This is the amount equivalent to the value of shares of Cairn that the government had sold to recover a part of the tax demand. It also includes the dividends and tax refund seized.
Sources said Vodafone International Holding (a Netherland company) had in February 2007 bought 100 per cent shares of Cayman Island-based company CGP Investments for USD 11.1 billion to indirectly get 67 per cent control of Hutchison Essar Ltd – an Indian company.
The Tax Department felt the deal was designed to avoid capital gain tax in India and so imposed a tax demand, which was rejected by the Supreme Court in 2012.
To stop abuse and plug the loophole of such indirect transfer of Indian assets, the government in 2012 amended the law to make such transfers taxable in India, they said adding Vodafone was slapped with a fresh demand which the firm contested through international arbitration.
The tax demand on Cairn Energy, they said, is different as it pertains to alleged capital gains the firm made on transfer of Indian assets to a new company and listing it on bourses.
Dheeraj Nair, Partner, J Sagar Associates, said the government “should challenge the (Vodafone) award since this award will have persuasive value in other treaty arbitrations which concern the retrospective tax measures”.
“Any party dissatisfied with the award has a right to challenge it, therefore such challenge is justified,” he said.
Sonam Chandwani, Managing Partner at KS Legal & Associates, however, said “as the Permanent Court of Arbitration situated in The Hague had passed the award in favour of Vodafone, there lies no further authority for putting up appeal”.
“The government can only go back to the Permanent Court of Arbitration on some technical point, but that will not serve any purpose,” she said.
Since the Indian Arbitration Act obliges the government to implement a foreign tribunal award, Vodafone can ask for the same in case the award was challenged in Indian courts, she said.
“However, in the present scenario, since all the property, both tangible and non-tangible of Vodafone, lies outside India it will be difficult for the government to procure the same,” she said.
She said in the case of Cairn Energy, India in order to procure the retrospective taxes has already expropriated all their investment.
“In circumstances such as when the Permanent Court of Arbitration gives a decree in favour of Cairn, the government of India still has the option to procure the desired retrospective taxes via grounds such that taxation is not covered under any bilateral investment protection treaty and as such cannot be arbitrated. It is challenging the jurisdiction of such panels to adjudicate on a tax matter,” she said.
Nair said the government certainly has the option not to appeal in Vodafone but do so in the case of Cairn as each case is independent and brought under a different treaty, which gives different protections.
Cairn’s claim is under the India-UK treaty whereas Vodafone’s claim was under the India-Netherlands treaty.
While Nair said there would not be any additional negative impact on investor sentiment as they recognise that challenge proceedings are part of the norm, Chandwani said appealing against an international arbitration award will disincentivise the investors.
“Any investor will start contemplating on investing in such countries as any dispute arises the government of such countries might not comply with the international order, putting the investors to losses. It creates hindrance in the ease of doing business in such countries and thus discourage them to make any investments to indulge in any form of funding,” she said.
Source: Press Trust of India
NEW DELHI: Bharti Airtel, India’s telecommunications services provider, today announced the launch of its ultra-fast 5G services in 125 cities. Airtel 5G Plus service is now available to customers in over 265 cities in the country.
Airtel 5G Plus has three compelling advantages for customers. First, it runs on a technology that has the widest acceptance in the world with the most developed ecosystem. This ensures that all 5G smartphones in India seamlessly work on the Airtel network. Second, the company promises to deliver the best experience – between 20 to 30 times higher speeds than today coupled with brilliant voice experience and super-fast call connect. Finally, Airtel 5G Plus network will also be kinder to the environment with its special power reduction solution. Powered by the reliable Airtel network infrastructure, Airtel 5G Plus will provide superfast access to High-Definition video streaming, gaming, multiple chatting, instant uploading of photos et all.
Commenting on the launch, Randeep Sekhon, CTO, Bharti Airtel said, “5G has revolutionized the world of internet, ushering new era of connectivity and communications that will prove to be a game-changer for the country. At Airtel, we remain committed to delivering the highest quality of network and service to our customers as we roll-out 125 more cities today. Airtel was the first in the country to offer 5G services in October 2022, and today’s mega launch is our promise to connect every Airtel customer in the country with ultra-fast Airtel 5G Plus. Our 5G rollout is on track to cover all towns and key rural areas by March 2024.”
Airtel 5G Plus service availability will continue to rapidly expand – including service in all towns and villages in the country soon – as the company is working towards offering nationwide coverage. Airtel is now offering its 5G services in every major city from the upper northern city of Jammu to the southern tip of Kanyakumari.
In the last one year, Airtel has demonstrated the power of 5G with a host of powerful use cases that will change the way customers lead their lives and do business. From India’s first live 5G network in Hyderabad to India’s first private 5G network at the BOSCH facility in Bengaluru to partnering with Mahindra & Mahindra to make its Chakan manufacturing facility, India’s first 5G enabled auto manufacturing unit, Airtel has been at the forefront of 5G innovation.
NEW DELHI: Apple Inc has rolled out a beta programme to enable 5G on Apple devices as the upgrade lets users try out pre-release software.
This software upgrade enables 5G access on Apple devices, as and when service providers Jio, Airtel and Vodafone enable 5G network access, sources said.
Apple Users have to enrol for the Beta Programme on the website, install a profile and download the software.
Jio users using iPhone 12 and above, in cities where JioTrue5G has been rolled out, will be invited to the Jio Welcome Offer. Jio Welcome Offer provides unlimited 5G data at up to 1 Gbps speed to users at no additional cost. However, there is a condition that prepaid users must be on active Rs 239 and above plan. All Postpaid users are eligible for this trial.
Airtel is not providing any special 5G offer like Jio to their users. In the cities/areas in which the Airtel 5G network has been launched, users can trial 5G services as a part of their existing plan, once they have updated the latest Apple Beta software.
While an email sent to Apple did not solicit an immediate response, the firm had last month stated: “We are working with our carrier partners in India to bring the best 5G experience to iPhone users as soon as network validation and testing for quality and performance is completed. 5G will be enabled via a software update and will start rolling out to iPhone users in December”.
Airtel and Jio customers on iPhone 14, iPhone 13, iPhone 12 and iPhone SE (3rd generation) models can experience 5G as part of Apple’s iOS 16 Beta Software Program. The Apple Beta Software Program is open to anyone with a valid Apple ID who accepts the Apple Beta Software Program Agreement during the sign-up process.
If a user has an iCloud account, that is an Apple ID, it is recommended they use that. If they do not have an iCloud account or any other Apple ID, they can create one.
Customers who want to try the beta software should back up their iPhones before installing the beta software. It is recommended to install the beta software only on non-production devices that are not business-critical. Users can also provide feedback to Apple on quality and usability, which helps Apple identify issues, fix them, and make Apple software even better.
The iOS beta comes with the built-in Feedback Assistant app, which can be opened from the Home screen on the iPhone or iPad or from the Dock on the Mac.
Source: Press Trust of India
5g
Nokia wins multi-year deal with Reliance Jio India to build one of the largest 5G networks in the world
NEW DELHI: Nokia has announced that it has been selected as a major supplier by Reliance Jio to supply 5G Radio Access Network (RAN) equipment from its comprehensive AirScale portfolio countrywide in a multi-year deal. Reliance Jio is India’s number one mobile operator and has one of the largest RAN footprints in the world.
Under the contract, Nokia will supply equipment from its AirScale portfolio, including base stations, high-capacity 5G Massive MIMO antennas, and Remote Radio Heads (RRH) to support different spectrum bands, and self-organizing network software. Reliance Jio plans to deploy a 5G standalone network which will interwork with its 4G network. The network will enable Reliance Jio to deliver advanced 5G services such as massive machine-to-machine communications, network slicing, and ultra-low-latency.
Akash Ambani, Chairman Reliance Jio, commented: “We are pleased to be working with Nokia for our 5G SA deployment in India. Jio is committed to continuously investing in the latest network technologies to enhance the experience of all of its customers. We are confident that our partnership with Nokia will deliver one of the most advanced 5G networks globally.”
Pekka Lundmark, President and CEO at Nokia stated: “This is a significant win for Nokia in an important market and a new customer with one of the largest RAN footprints in the world. This ambitious project will introduce millions of people across India to premium 5G services, enabled by our industry-leading AirScale portfolio. We are proud that Reliance Jio has placed its trust in our technology and we look forward to a long and productive partnership with them.”
Nokia has a long-standing presence in India. This new deal will mean that Nokia is now supplying India’s three largest mobile operators.
