Me, Vodafone and international taxation

As I heard that Vodafone lost a case in an income tax tangle and that it was related to international taxation, I immediately gauged it could be the work of one person or a team led by this person, who happens to be my former boss when I was a small time employee in income tax department.
The tax demand on the telecom major was prepared by Girish Dave and Rahul Navin. Girish Dave was my Additional Commissioner in Ahmedabad and I worked closely with him as a Tax Assistant starting from the Voluntary Disclosure (VDIS) scheme till the time he was transferred.
After a short while I resigned from the department to pursue what I was doing secretly when I was in the department itself. I used to use my holidays, Saturdays and Sundays and my eligible leave to travel across the country (mostly within the perimeters of Gujarat) for assignments – mostly socially and development related stories.
I never worked for any Indian organizations during this period and so my stories were never noticed or printed in India. Most of the stories for internet portals and thanks to poor penetration in India, no body noticed it.
But every one knew I was doing some sort of writing and nothing beyond that. But when in the office, I never mixed this with the official work and so there was no problem whatsoever – except perhaps one time when I took a print out of a story for editing and inadvertently one extra copy got printed in the laser printer which was noticed by Mr Dave – who gently called me and asked me to keep the work out of the regular job.
That was the time I told him that I am least interested in a government job where my wavelength never matched. And it never did and subsequently I left the job.
It was in recent times that I read a story on this case and ironically I got the number of Dave Saab – as we used to call him – and called him. Though I did not follow the case thoroughly, I did follow when the judgement was pronounced.
Though it may have got Vodafone by surprise, it didn’t surprise me by any standards, given the audacity with which Mr Dave takes his work to serious levels keeping no loopholes. Though his fountain pen (he used to write to Pilot pen then) may go dry, his hands would never get tired of writing innumerable pages which would form the note sheets (note sheets are very important part of filing in government departments).
It may have many implications as many experts point out but when you prepare a case, the only target is to see if the case has any merits and if it has, see to it that it concludes in a logical way. There is no point in fighting a case which you will lose because there are other implications attached with it.
I like the way Mr Dave takes the cases, and remembers them, however small it may be. When he was the Additional Commissioner in Ahmedabad, the Chief Commissioner was a person whom no body could approach. Very few people could enter his room and he was a terror in both his looks and his behaviour. He looked like Amrish Puri (was a Punjabi and his name was J M Mehra) and even his voice was as hard as a rock.
But a small time employee like me never felt this and so did a high ranked officer like Mr Dave. Mr Mehra never shouted at me though I was in his chamber for almost all day for one or the other work. He never did with Mr Dave either. This led me to realize that if you have done no wrong, you have nothing to fear. Follow your conscience which I still do though I am not in a government department any more.
I earned the nick name of CC for following my conscience. People in Income tax still remember me as an arrogant person who behaved as if I am the Chief Commissioner (CC), the highest ranking official of the state.
Coming back to the case, the questions industry is asking is whether the case will derail future deals as foreign investors grow wary of changing rules after the event? Vodafone supporters say this is as good as creating new rules. Such intervention will put all future deals in cold storage.
Vodafone International Holdings BV, a Dutch company wholly owned by U.K.-based Vodafone Group, has long challenged Indian tax authorities' jurisdiction to recover the tax, suggesting the deal between its Dutch unit and Hong Kong's Hutchison Whampoa Ltd.'s Cayman Islands-registered vehicle isn't liable to be taxed in India, as it took place on foreign soil.
Vodafone is to appeal this ruling in Supreme Court. But in case Vodafone loses the case again, a greater tax liability awaits them as the department will screen further financial details of the deal and will arrive at a final tax liability.
But that seems to a foregone conclusion as Mr Dave & Party may have left no loopholes in the case for Vodafone to apply balm on it. As I called him today, he seems not to be jubilant but victorious. As an officer in charge of getting revenue to the exchequer, he should be.