Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: TDS :: due date for vat payment :: list of goods taxed at 4% :: empanelment :: ACCOUNTING STANDARDS :: ACCOUNTING STANDARD :: articles on VAT and GST in India :: VAT RATES :: TAX RATES - GOODS TAXABLE @ 4% :: cpt :: Central Excise rule to resale the machines to a new company :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: VAT Audit :: form 3cd
 
 
« General »
 Confusion over GST persists: Wholesale grain market affected, sales fall by 40 percent in Pune
 Slow tax growth reflects companies' GST troubles
 What is PAN card? Why is it important?
 Govt to cut down executive discretion on tax laws
 Businesses can start filing July returns on GSTN from August 5
 Are you earning abroad? Know the tax rules
 Attention last minute tax filers! Know about key changes made by govt this year
 Accounting relief for IndAS companies
 How you can reduce your tax to zero if you have income within Rs 10 lakh
 NRIs’ overseas bank info needed only for tax refund
 Non-performance: I-T dept transfers 245 commissioners

Sanofi asked to cough up to pay Rs 700 cr tax by the I-T department
November, 16th 2010

After telecom giant Vodafone, it is now the turn of another cross-border merger involving Indian assets to have landed in a tax tangle. Sanofi-Aventis, which picked up a majority stake in the unlisted Hyderabad-headquartered pharma major Shantha Biotechnics in 2009, has been asked to cough up a capital gain tax amount of Rs 700 crore by the Income Tax (I-T) department. Sanofi has challenged the I-T department's claim and the matter is now in the AP High Court.

Income Tax officials say the case is akin to that of Vodafone, which too is fighting a similar tax battle after it was asked to clear its dues of Rs 11,218 crore as capital gain tax on its acquisition of Hutchison. The IT department in Hyderabad has raised a similar claim on France's biggest drug maker, Sanofi-Aventis, whose acquisition of Shantha Biotechnics was valued at 550 million euros (Rs 3,770 crore).

With the Bombay High Court ruling in the Vodafone matter, the officials of the international tax division of IT department said that their capital gain tax claim on France's biggest drug maker for similar evasion just got a tad stronger.

"Transfer of capital assets results in capital gains and the stake holders therefore get covered under the jurisdiction of the Indian Income Tax Act, 1961. While Vodafone has been doing business for a longer period and therefore has to pay an extra interest amount, in Sanofi's case, the merger is recent and therefore the claim amount is comparatively less," said a department source. (Of the I-T department's total raised demand of Rs 11,218 on Vodafone, Rs 7,900 crore is the tax amount with Rs 3,318 crore as interest for 42 months of operation in India.)

It is learnt that Sanofi managed to convince both individuals and corporate players in India and abroad to invest in its shares and drew home another Rs 100 crore after its stakes went high following the merger.

Defending its stand Sanofi-Aventis is said to have argued saying that such mergers are not taxable and they have clearly not made any capital gain on the deal.

However, IT officials note that with this first big-ticket deal for a foreign company in the Indian biotech sector, Sanofi got a platform in the country and also access to new products of Shantha Biotech, which is known for its range of vaccines and has been a supplier of vaccines to Asia-Pacific, Africa and Latin America.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Sitemap

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions