Financial Transparency Coalition

The Central Board of Direct Taxes (CBDT) in India brought out a Manual on Exchange of Information in January 2013, including Automatic Exchange of Information. Although this Manual was released to provide guidance to Investigating Officers explaining various provisions and for making requests to countries, it is pertinent to note some of the discussion which is of relevance particularly for Automatic Exchange of Information.

In a judgment having far reaching consequence, a three judges bench of the Supreme Court of India, in the case of Vodafone International Holdings BV v. Union of India, has set aside the Mumbai High Court judgment, which had required Vodafone to pay capital gains tax worth US$2.5 billion to the Government of India for a transaction that had seen the company acquire 67 per cent stake in Hutchison Essar (a mobile phone operator in India) in 2007. Vodafone, the second largest telecom operator in India, had challenged the tax bill over its US$11.5 billion deal to buy Hutchison...