VODAFONE International BV continues to be in news. But this time it is not for the tax liability but the commission on the deposits ordered by the Supreme Court. In the last hearing the SC had directed the assessee to deposit Rs 2500 Crore in cash with the Registry and a Bank Guarantee of Rs 8500 Crore. Vodafone, a UK-based company, wire-transferred the sum from outside India into the RBI account, and thus, the sum was finally transferred to the SC Registry's account. As per the court direction, the Income Tax Department was permitted to withdraw the money from the Registry's account but for a twist which has its origin in the Entry 26 of Part III of Third Schedule of the Supreme Court Rules, 1966 which prescribes 1% commission on all moneys or securities paid to the Registrar or deposited with him. This 1% commission works out to Rs 25 Crore.

Now the issue before the CBDT is how will it account for this Commission? Since there is no head under which it can pay commission on recovery of tax dues, it has filed a miscellaneous petition before the Bench for waiver of the Commission. Whether it will succeed or not, the commission amount is also likely to go to the Consolidated Fund of India.

Meanwhile, in another development the Gujarat High Court has refused to sanction the demerger scheme of Vodafone-Essar Gujarat Limited (VEGL) of its infrastructure assets to Vodafone-Essar Infrastructure Limited (VEIL) on an application by the Income tax Department on ground of evasion of capital gains tax. However, it is learnt that the order is suspended for two weeks, on a request made by Vodafone- Essar's  counsel so that they can approach the higher court.