Vodafone Essar has filed a writ petition in the Mumbai High Court seeking the quashing of a show cause notice served on the company by the income tax department.
The income tax department had recently issued a show cause notice to Vodafone Essar (formerly Hutchison Essar) asking to explain why it should not be regarded as an agent of Vodafone under the income tax law.
This move of the tax department was seen as an attempt to collect capital gains tax on the $11.1 billion Vodafone-Hutchison deal that led to transfer of control in Hutchison-Essar from the Hong Kong-based Hutchison Telecom International to UK-headquartered Vodafone.
The first hearing on the petition may come about on September 27, sources familiar with the development said.
Tax experts say that a writ petition has been filed to ensure that the income tax department does not take further action on the show-cause notice.
Vodafone Essar had on September 7 submitted a letter to the income tax department in reply to the show cause notice.