Vodafone has offered conciliation on the controversial $11.2-billion Hutchison Essar deal of 2007 and Cabinet will take a decision on whether to go for it or not, Finance Minister P. Chidambaram has said.
This revelation came hours after he presented a Union Budget that remained silent on how the Centre would progress on the issue of controversial retrospective amendments that brought indirect offshore transfer of shares to tax in India.
Chidambaram also said that Shome Committee’s recommendation that only tax, and not penalty, should be collected in case of retrospective amendments, is under Government’s consideration.
The Government appointed Shome committee had recommended that indirect offshore transfer of shares with underlying Indian assets should be taxed only on prospective basis.
In fact, Chidambaram’s silence on Shome committee recommendations and retrospective amendments (that brought Vodafone type transactions to tax ) in his Budget speech stumped tax experts and economy watchers.
This is also being seen as Government’s decision to retain retrospective amendments in the statute book and not go in for any rollback.