NEW DELHI, Sept 6 A Mumbai court dismissed a
petition by Vodafone Group in a tax dispute with the
Indian authorities, ruling on Friday that a tax tribunal should
examine the matter first, the British mobile company said.
Vodafone said it has almost 12 weeks to review its options
and that the Bombay High Court had extended a stay on a final
tax demand order by the authorities.
Last year, Vodafone had filed the petition to the Bombay
High Court in a transfer pricing dispute after authorities
sought to add 85 billion rupees ($1.3 billion) to the taxable
income of a unit, Vodafone India Services Pvt Ltd, which
provided call centre services to some group companies.
Transfer pricing is the value at which companies trade
products, services or assets between units, across borders.
"The Bombay High Court's decision today focused solely on
procedure and not on the merits of Vodafone's case," Vodafone
said after Friday's court ruling.
Transfer pricing officials in Mumbai declined to comment on
the court order.
The dispute relates to accounts for the financial year
ending March 2008. Vodafone received another transfer pricing
order in February this year over the issue of shares by the same
unit. Vodafone has said both disputes are linked.
The cases are separate from a more-than $2 billion tax
demand over the British firm's 2007 acquisition of Hutchison
Whampoa's Indian mobile phone business.
Vodafone is currently in talks with Indian finance ministry
officials to resolve that dispute.