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Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? for Banking Exams 2025 is part of Banking Exams preparation. The Question and answers have been prepared according to the Banking Exams exam syllabus. Information about Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? covers all topics & solutions for Banking Exams 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer?.

Solutions for Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? in English & in Hindi are available as part of our courses for Banking Exams. Download more important topics, notes, lectures and mock test series for Banking Exams Exam by signing up for free.

Here you can find the meaning of Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer?, a detailed solution for Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? has been provided alongside types of Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice Read the passage given below and answer the questions based on the available information.The last two years have been a rough ride for the Indian government regarding the bilateral investment treaty (BIT) arbitration cases. In 2012, when the Indian parliament amended the Income Tax Act, 1961, retrospectively through the Finance Act, 2012, in order to circumvent the effect of the Supreme Court’s judgment in the Vodafone v. Union of India. The 2012 amendment clarified that the gains arising from sale of shares of a foreign company were taxable in India if such share, directly or indirectly, derived its value substantially from the assets located in India. Further, it also validated the demands under the Income Tax Act, with respect to cases relating to indirect transfer of assets situated in India.The 2021 Taxation Bill, inter alia, makes two important points. First, that no future tax demands will be made based on the retrospective amendment of 2012 with respect to indirect transfer of Indian assets; and second, that all the demands already raised regarding such transfers will be nullified, on the fulfillment of specified conditions. The conditions involve withdrawal of, or submission of an undertaking to withdraw any appeal before any appellate forum, or writ petition before any high courts or the Supreme Court. Most importantly, where any proceedings for arbitration, conciliation or mediation have been initiated under any BIT, or any other international agreement, or any other law, such claims have to be withdrawn, or an undertaking for such withdrawal has to be submitted.Further, the Bill also provides for the refund of any payments already made, but without the interest which may have accrued thereon. One cannot help but point, however, that neither the investors nor the government benefited from this clearly avoidable and unnecessary legal battle over the course of almost a decade. The only (I)benefactors from the BIT arbitrations in these cases have been the arbitrators and the lawyers. Investment treaty arbitration is a costly business, and the money at stake belongs to the taxpayers.While the Indian government is correct in claiming that taxation is a sovereign right, it did cede a chip of that right away when it signed the older generation BITs with wide provisions, without excluding taxation or tax-related disputes from the jurisdiction of BIT arbitration tribunals. This is a fact clearly known to the government, and pointed out repeatedly by the critics. The expenses of the BIT arbitrations in three cases relating to retrospective taxation – Vodafone, Cairn Energy and Vedanta – could have been clearly avoided.The intention of the government behind this Bill is pretty clear. (A)of 2012 and the tax demands made in pursuance thereto (i)/ the statement of objects and reasons (ii)/ in a few cases continue to be a sore point with potential investors (iii)/ clearly point out that the retrospective clarificatory amendment (iv). There is indeed no doubt that this Bill is a step in the right direction, as it will save thousands of crores of taxpayer money, which would have been paid as compensation to the foreign investors. It will help in plugging the uncertainties, and restoring investor confidence by ensuring predictability in the legal climate. The 2021 Bill might just be the end of BIT arbitration cases with Vodafone, Cairn and Vedanta, and for good.Q. Which of the following ironies has been mentioned in the given passage?a)Despite the rigorous taxation policy introduced through amendments in 2012, there are indications that the government has actually started heeding the calls of the critics.b)Although the government has introduced strong taxation norms, the position of the Indian government is precarious so far as BIT arbitrations are concerned.c)Despite several efforts by the government to attract investments, the approach of the Indian government has also led to growing concern among the foreign investors.d)While the Indian government is justified in asserting that taxing is a sovereign prerogative, it has already relinquished a portion of that power.e)All are correct.Correct answer is option 'D'. Can you explain this answer? tests, examples and also practice Banking Exams tests.