9911796707
TMI Blog2021 (7) TMI 1454X X X X Extracts X X X X X X X X Extracts X X X X ..... tions in our perceptions vis-à-vis that of the assessee, but then, given the limited purposes for which the facts are being set out, nothing much really turns on these variations, even if any. Be that as it may, the assessee company, incorporated in India in March 1999, as 3 Global Services Pvt Ltd, is owned by a Mauritian company now known as Vodafone Tele-Services (India) Holdings Limited [Vodafone Services- M, in short], which, in turn, is owned by a Cayman Islands-based company by the name of CGP Investments (Holdings) Limited [CGP- Cayman, in short]. CGP-Cayman, as a result of the acquisition of its ownership by Vodafone International Holdings BV [VIH-BV, in short] which itself is a fully owned subsidiary of the global telecom giant Vodafone Group plc, UK [Vodafone-UK, in short] which carries on telecommunication business in India, through its operating company Vodafone India Limited [Vodafone-India, in short] and entire shareholding of Vodafone-India is owned by a number of subsidiaries and associated entities controlled by CGP-Cayman Islands, and, during the process of change in ownership and on account of compliance requirements with domestic FDI regulation, through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Pvt Ltd [TII, in short] which holds significant equity capital of Vodafone India Limited. In effect, thus, it could be said that the assessee company's nomination of CGPI-M for buying shares in Scorpio Beverages held by Analjeet Singh Group, resulted in an increase of equity shareholding of CGP Cayman Islands in the Vodafone India. It may be noted that Analjeet Singh and his associate, as also two other persons who were playing a similar role under the Framework Agreement- namely Asim Ghosh Group and IDFC Group, were seemingly independent but de facto under full control of CGP-Cayman Islands. It was also noted that as a result of CGPI-M being nominated to purchase 51% shares of Scorpio Beverages, the CGPI-M was enabled to buy 4.53% equity in Vodafone India at a price of Rs. 1,241 crores, whereas the market price of this shareholding was Rs. 2,285 crores in excess. It was also noted that while the assessee has already paid the premium of Rs. 45.69 crores in connection with these options, the assessee parted with the right to buy the shares at a rate much lower than market value ( Rs. 1,241 crores, as against Rs. 2,285 crores in excess) without any consideration. It was thus noted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee thus has an arguable case in appeal. We have also noted that almost 98% of the impugned demand is in respect of this ALP adjustment. We have also taken note of learned counsel's submission that the assessee has already provided a corporate guarantee by its ultimate parent company, i.e. Vodafone International Holdings BV, for an amount of Rs. 3,538.48 crores for the assessment year 2008-09 and this guarantee is yet to be returned by the income tax department and that this guarantee adequately covers the amount disputed in the appeal. However, when we pointed out that the guarantee is specifically for the assessment year 2008-09 and so far as that assessment year is concerned, as things stand now, the matter is resolved in favour of the assessee by Hon'ble jurisdictional High Court, learned counsel submits that as the matter is pending before Hon'ble Supreme Court, the guarantee is very much alive and, being in possession of the income tax authorities anyway, it can very well be enforced by the income tax authorities. She submits that in case the income tax department is to take the stand that this guarantee is no longer valid, they should as well withdraw the appeal befo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s per se, even if that be so, cannot be put against the bonafides of the impugned tax demands at this stage. As regards the arguments on the first proviso to Section 254(2A), whether the said proviso is applicable or not, the Tribunal is not denuded of the powers to direct that the part payment of demands even in excess of 20% be made by the assessee before the stay is granted in a fit case. While it may be argued, whatever be the legally sustainable merits of such a proposition, that the limitation placed by the first proviso to Section 254(2A) comes in the way of the Tribunal granting a blanket stay or a stay, on payment of less than 20% of the disputed demands, but then even this proposition is highly contentious. In any event, that is not the case here. Given the factual matrix as discussed above, given the fact that the coordinate bench decision seems to be against the assessee on many of the facets of the main issue raised in this appeal, and given the fact that Hon'ble High Court, in assessee's own case on somewhat material facts, has directed the payment of 20% of the disputed demands, we do not think it is a fit case for grant of blanket stay. We have also noted that out o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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