Centre will challenge Vodafone arbitral award

NEW DELHI: Armed with an opinion from solicitor general Tushar Mehta that an arbitral tribunal cannot render a law passed by a sovereign Parliament ineffective, the Centre will soon challenge the Permanent Court of Arbitration award, which quashed the income tax department’s demand of Rs 22,000 crore as tax, penalty and interest on Vodafone on the ground that India violated the bilateral investment treaty with the Netherlands by retrospectively amending the law.

“The question of law — the power of an arbitral tribunal to virtually and substantially declare a parliamentary legislation of a competent Parliament of a sovereign nation to be non est and unenforceable — itself is an issue which needs to be challenged. I therefore, opine that the Union of India must challenge the said award and must file all available proceedings to challenge the award and/or to protect the interest of Union of India,” Mehta said in his opinion.