Delhi High Court Says It Will Pass Its Order On Centre's Appeal Against Vodafone Grp Plc

A Division Bench of Justice Rajiv Sahai Endlaw and Justice Asha Menon today said it would pass its order on an appeal by the Centre to restrain Vodafone Group Plc from initiating second arbitration proceedings under the India-UK Bilateral Protection Agreement (BIPA), after the Centre asked the court to defer the appeal sine die, refusing to make a statement on whether it would challenge the International arbitral award against it. Sr. Adv. Anuradha Dutt appearing for Vodafone, interjected at this point and said that, "It is clear that the Centre is going to file an appeal." The bench told the Centre, "Your fear (of simultaneous proceedings under second BIPA) has disappeared," in response to which Additional Solicitor General Chetan Sharma, appearing for the Centre, told the Court that the BIPA cannot be a "gun on my (the Centre's) head" (to take a call on the arbitral award). The court had in an earlier proceeding asked the Centre to state whether it would challenge the international arbitral tribunal's award, in the Vodafone Group tax case worth Rs. 4,000 crores, that had held India's tax department in breach of the India-Netherlands Bilateral Investment Treaty. Sharma held on to the Centre's earlier assertion, reiterating that, initiating arbitration under India-UK BIPA was an abuse of process. Vodafone, on the other hand maintained that it would not proceed with the second arbitration under the India-UK BIPA unless the award under the India-Netherlands BIPA was set aside by the competent authority. The present appeal was filed by the Centre in 2018 after Vodafone initiated its second arbitration proceeding under the India-UK Bilateral Investment Protection Agreement, over tax imposed on it by the Indian government for its $11 billion acquisition of the Indian assets of Hutchison Essar Ltd in 2007. The Centre had moved the High Court against this second arbitration, however, a Single Judge bench had rejected it's plea, in response to which it appealed before the Division Bench. The arbitration proceedings were directed against the retrospective imposition of tax liability on Vodafone following its 2007 stake-acquisition in Hutch. Recently, in the first arbitration proceedings, the Permanent Court of Arbitration at The Hague ruled in favour of Vodafone.

Delhi High Court Says It Will Pass Its Order On Centre's Appeal Against Vodafone Grp Plc

Shreya Agarwal

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