Discussion with litigants will happen after law to nullify retrospective tax comes into force: Finance Minister

The Parliament on Monday passed a bill that seeks to do away with the contentious retrospective tax provision and will impact retro tax cases of Cairn Energy and Vodafone.

Replying to the brief debate on the Taxation Laws (Amendment) Bill, 2021, in Rajya Sabha, Finance Minister Nirmala Sitharaman responded to a member's question if Cairn Energy or Vodafone will pursue any further appeals or arbitration after the enactment of the legislation.

"Discussions with the litigants will happen after the enactment of this law. Once it is passed, we are confident that they will also find the provisions very useful for them and, probably, consider taking into consideration what we brought in," she said.

Sitharaman said the government will refund the amounts "which are with us" and will not pay any interest. "That is very clearly a part of the bill," she said.

Congress, DMK and Trinamool Congress staged a walkout before the bill was taken up for discussion.

The bill had earlier been passed by Lok Sabha.

CBDT Chairman JB Mohapatra toldthat the new law is likely to come into effect by next week.

"We will have the new law by early next week," he said.

"There has been absolutely no pressure. The amendment is only to make matters clear and unambiguous to the investing community. It is all thanks to the combined leadership of at the level of government and bureaucracy. The political leadership has helped to pilot this amendment through," he added.

The bill proposes to amend the Income Tax Act, 1961 to provide that no tax demand shall be raised in future on the basis of the retrospective amendment for any indirect transfer of Indian assets if the transaction was undertaken before May 28, 2012.

( With inputs from ANI )

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