The Central Cabinet has decided not to appeal against the Bombay High Court ruling that Vodafone was not liable to pay tax  demand of Rs.3200 crore in a transfer pricing case. It is stated by Shri Ravi Shankar Prasad, Communications Minister that the decision is to send out message to global investors”whose confidence in India was shaken in the past”.

The Income Tax Department had issued a show cause notice to Vodafone on 17th June, 2014 asking it to pay Rs.3,200 crore in tax for allegedly undervaluing shares of its Indian subsidiary during transfer pricing.

Vodafone is a telecom company with 100 per cent FDI which is known for frequent violations of license provisions and merger and acquisition rules inviting penalties. So the decision of the government is in full conformity with its policy of wooing the corporates and the rich at the cost of the common people.