Unitech shares in Telenor JV frozen

NEW DELHI Thu Mar 29, 2012 3:12am IST

A man speaks on a mobile phone in front of a billboard of Uninor at a market in Ahmedabad February 6, 2012. REUTERS/Amit Dave/Files

A man speaks on a mobile phone in front of a billboard of Uninor at a market in Ahmedabad February 6, 2012.

Credit: Reuters/Amit Dave/Files

Related Topics

Stocks

   

NEW DELHI (Reuters) - The Income Tax department has frozen shares owned by Unitech Ltd (UNTE.NS) in a mobile phone joint venture with Norway's Telenor (TEL.OL) over a tax demand the Indian real estate company disputes as baseless.

Telenor owns a 67.25 percent stake in the joint venture, Unitech Wireless, which operates under Uninor brand, with the remainder held by Unitech.

The joint venture is among a group of telecom companies that are set to lose their licences in early June after India's Supreme Court last month ordered cancellation of all cellular permits awarded in a scandal-tainted 2008 sale.

Unitech Wireless acknowledged on Wednesday it had received notices from India's tax office stating that they had "attached" shares in the JV owned by Unitech through three of its units.

In a separate statement, Unitech said the tax office had issued orders to two of its group companies demanding tax related to the deal in which Telenor bought a majority stake in the joint venture, adding the demand was "baseless".

"In the case of our two group companies, the tax department has issued a demand order based on the presumptive gains on their shareholding... without there being any actual sale of shares by these companies and consequent profit to them," it said.

A spokesman for Unitech declined to say how much the tax office was demanding, while a spokeswoman for the tax office could not be reached for a comment.

Unitech has previously said it did not sell its stake in the phone company to Telenor, but issued new shares to the Norwegian company to get investments in the venture.

Telenor and Unitech have been embroiled in a dispute since the licence cancellation order. Telenor, which had bought into the Indian venture after the licences had been awarded, has accused Unitech of "fraud and misrepresentation".

Telenor wants to migrate the business to a new venture and seek fresh licences in an auction. Unitech is opposing Telenor's move. Both sides have appealed to India's Company Law Board, a quasi-judiciary body, which resumed hearing the case this week.

With 41 million subscribers as of February, Uninor ranks eighth in a market of 15 mobile operators.

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Markets

REUTERS SHOWCASE

Segway in India

Segway in India

Segway’s India business pegs hope on tech-savvy Modi  Full Article 

Power Outage

Power Outage

Mumbai hit by power cuts  Full Article 

Commodities

Commodities

Gold imports, premiums to jump on festive demand - top refiner  Full Article 

Economic Worries

Economic Worries

Pakistan's promises to IMF in doubt as protests sap economy   Full Article 

Islamic Finance

Islamic Finance

Basel III deposit challenge looms over Islamic banks   Full Article 

Antitrust Probes

Antitrust Probes

U.S. business lobby says concerned China antitrust probes unfair.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage