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Vodafone could face $2bn tax bill

By Joe Leahy in Mumbai and Amy Yee in New Delhi

Published: October 31 2007 17:46 | Last updated: November 1 2007 02:44

The Indian government on Wednesday scored an early win in its efforts to force Vodafone to pay what lawyers estimate could be $2bn in capital gains tax on its acquisition of domestic mobile phone operator Hutchison Essar this year.

In a case closely watched by foreign investors, the Bombay High Court allowed India’s income tax department to pursue an investigation into the claim and scheduled another hearing for December.

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