Why are we Indians losing International financial cases at Hague?
By vanny
@vandana7 (98834)
India
December 23, 2020 12:29am CST
Is it because our sense of justice is skewed?
Is it because we do not have good lawyers fighting our cases?
Is it because our understanding of financial commitment different from that elsewhere, and we are not updating our understanding to match with International standards, even though we want to do business internationally?
Or
Is it because we feel confident we can bribe there as well, like we do in India?
Whatever, Vodafone case and Cairn Energy case should make Indians more alert and aware of International commerce.
Each International document needs to be studied by at least 10 different advocates five of whom should be from corresponding foreign countries, so that interpretations don't go wrong and we do not become liable for huge sums.
Being a taxpayer in this country is no fun.
7 people like this
6 responses
@vandana7 (98834)
• India
23 Dec 20
Cairn India closed its shop in 2006.
It sold the business to Vedanta, earned some minor profit, paid taxes in its world, and left.
In 2012 the then government realized that companies like Cairn had earned decent profit. So they decided to impose taxes with retrospective effect, even though bilateral agreement between India and UK does not make it liable for taxes here.
Arbitrator held that Indian government was wrong in pursuing taxes retrospectively. I concur because profits would be distributed to shareholders, or invested elsewhere. In any event, the bilateral agreement prevents us from doing it.
Trying to extract some monies retrospectively at present rates is not ok. Bad policies existed. We all make mistakes. They just have to be accepted. We cannot create more bad policies to cover up for previous bad policies. Cutting losses is needed.
@vandana7 (98834)
• India
23 Dec 20
@piyushbhatia1 But we wasted taxpayer's money on traveling and advocates...grrr.
@crossbones27 (48434)
• Mojave, California
23 Dec 20
I always find it funny how people take this as a slap toward the country instead of patriotism of the country you love. Calling it out in hopes you make it better. What is ever wrong with that? Good for you miss lady.
2 people like this
@vandana7 (98834)
• India
23 Dec 20
It is mistaken patriotism in this case.
In the year 2006, if tax exemption slab is 50000 and tax rates are 10 percent then if taxes are paid accordingly all should be good.
But if in 2012 according to new laws that 50000 needed to be taxed at 25 percent, then you cannot apply to a transaction that is over in 2006.
That is the issue here.
2 people like this
@crossbones27 (48434)
• Mojave, California
23 Dec 20
@vandana7 All countries burn in flames with their fake money,
1 person likes this
@RebeccasFarm (86764)
• United States
23 Dec 20
Everyone is crooked in those places Vanny.
1 person likes this
@DaddyEvil (137142)
• United States
25 Dec 20
I don't really understand what this is about. I went and read some articles about the two cases... and it seems like, but I may be misunderstanding, that the Indian government tried to tax companies over acquisitions before the company owned the acquisitions.
That would be like my government charging me taxes on a house I purchased three years before I bought the house. That isn't legal, nor is it logical.
What am I misunderstanding here?
@vandana7 (98834)
• India
23 Dec 20
This company stepped out in 2006, liquidating all the assets, paying whatever was due at that time. In 2012 new laws came into force. This foreign company was slapped with a huge tax penalty which it was not liable for according to bilateral treaty between India and UK. Our government continued with the case seeking retrospective tax. Weird don't you think?
1 person likes this
@vandana7 (98834)
• India
23 Dec 20
@Fleura 1. Tax exemptions slabs and rates differ annually or biannually. Full 6 years have lapsed in between. Any property or share sold would have appreciated in value. So calculating taxes as per 2012 and then slapping it is weird.
2. The bilateral agreement had different clauses. The time to understand implications was then. What the hell was the government doing.
3. Bilateral agreements have clauses which prevent a person from being taxed at both ends. So if Cairn opted to pay taxes in the UK, nothing wrong!
4. Wasting taxpayer's monies is pursuing a case that had no merits was an eyewash.
1 person likes this
