JUDGMENT

S.H. Kapadia, CJI

1. Leave granted.

Introduction

2. This matter concerns a tax dispute involving the Vodafone Group with the Indian Tax Authorities [hereinafter referred to for short as “the Revenue”], in relation to the acquisition by Vodafone International Holdings BV [for short “VIH”], a company resident for tax purposes in the Netherlands, of the entire share capital of CGP Investments (Holdings) Ltd. [for short “CGP”], a company resident for tax purposes in the Cayman Islands [“CI” for short] vide transaction dated 11.02.2007, whose stated aim, according to the Revenue, was “acquisition of 67% controlling interest in HEL”, being a company resident for tax purposes in India which is disputed by the appellant saying that VIH agreed to acquire companies which in turn controlled a 67% interest, but not controlling interest, in Hutchison Essar Limited (“HEL” for short). According to the appellant, CGP held indirectly through other companies 52% shareholding interest in HEL as well as Options to acquire a further 15% shareholding interest in HEL, subject to relaxation of FDI Norms. In short, the Revenue seeks to tax the capital gains arising from the sale of the share capit