CBDT Chairperson JB Mohapatra has said that the government will refund over rupees 8 thousand crore to four companies which includes including Cairn Energy, Vodafone, WNS Capital and one more after the Taxation Laws Bill 2021 becomes a law .
The Taxation Laws Bill, 2021 was passed on August 9 in Rajya Sabha which proposes amendments to the Income Tax Act, 1961 and does away with the disputable practice of backdated tax.
The bill states, "no tax demand shall be raised in future on the basis of the said retrospective amendment for any indirect transfer of Indian assets if the transaction was undertaken before May 28, 2012."
This is the date on which the Finance Bill, 2012 had received the approval of the then President of India.
Chairperson Mohapatra told news agency ANI, "As far as I know, there are four cases. Apart from Cairn Energy, three other cases are WNS capital, Vodafone and there is one more case. So, in total, in excess of Rs 8,000 crores will be paid out by way of refund and the refund will be without any interest."
Mohapatra said the bill is likely to become a law next week, after being approved by the Rajya Sabha, the bill will come back to Lok Sabha for confirmation and then will go to Ministry of Law for notification.
The chairperson Mohapatra says that a statement of the Finance Minister says that there are about seventeen cases, in which four cases where demands have been paid as a part and those four cases where demands have been paid.
He says that there are other 13 cases where demands have been lift but they have not yet been discovered.
He further said, "So it will be a simple refund to be given by the Income Tax department for the payments they have made, they will be refunded in terms of the amendment which has been brought through as and when it is passed, and given assent by the President and becomes law."
The bill was introduced after India lost backdated tax demand cases against Cairn Energy Plc. and Vodafone.
The Centre had challenged the verdict in both of these cases, but had raised many questions within the country existence of backdated taxation.
To which, passing of this bill is expected to have a huge impact on these demand cases.
The move has been welcomed by several businesses and economists as it is supporting the recovery of the nation's economy by attracting investments.