Indian court rules for Sanofi in tax dispute
MUMBAI Feb 15 (Reuters) - An Indian court ruled on Friday that French drugmaker Sanofi SA is not liable to pay local capital gains tax for its 30 billion rupee ($556.64 million) acquisition of Indian vaccine maker Shantha Biotechnics, a lawyer for Sanofi said.
Sanofi bought Hyderabad-based Shantha Biotechnics in 2009 through its acquisition of French firm ShanH, which owned a majority stake in the Indian drugmaker.
Indian tax officials had demanded more than $185 million in capital gains tax on the acquisition from Sanofi India . Sanofi has maintained that the acquisition was subject to tax in France, and challenged the demand in the Andhra Pradesh High Court.
In a similar case, India's Supreme Court last year rejected a $2.2 billion tax demand on British telecoms firm Vodafone over its acquisition of Hutchison Whampoa Ltd's Indian cellular business in 2007.
India is again seeking to tax Vodafone after a law change enabled it to tax already-concluded deals, which Vodafone is disputing.
"The court has maintained that, according to a business treaty between India and France, this transaction can be taxed only in France," said Rohan Shah, managing partner of Economic Laws Practice in Mumbai, who represented Sanofi.
The ruling could not immediately be independently verified by Reuters.
In a statement on Friday, Sanofi said it was reviewing the contents of the judgment announced by the high court.
Shares in Sanofi India rose 3.7 percent to 2,323.10 rupees on Friday, outperforming the wider Mumbai market, which fell 0.15 percent.
($1 = 53.89 rupees) (Reporting by Kaustubh Kulkarni; Editing by Tom Pfeiffer and Elaine Hardcastle)
- Sierra Leone declares emergency as Ebola death toll hits 729 |
- S&P500 index posts worst fall since April; indexes down for July
- U.S. man sues soccer star Cristiano Ronaldo over CR7 trademark
- Israel, Palestinian militant groups agree to three-day Gaza truce |
- Moscow fights back after sanctions; battle rages near Ukraine crash site |