Ncell the organization owned by the Axiata UK has paid Rs 4.5 billion out of the total due of 22.44 billion as capital gains tax (CGT) in its acquisition deal aginst TeliaSonera Norway .
The payment came out of the deal on the verdict of the Supreme Court, the Land Revenue and Tax Office had asked Ncell to deposit Rs 22.44 billion remaining CGT within 15 days on December 8. Dragging the case of the CGT, Ncell took the case to the International Centre for Settlement of Investment Disputes where on December 19, it issued an interim order directing the government including the Inland Revenue Department and NCELL not to take any steps to enforce its decision to collect the outstanding capital gains tax, including interest and penalties, from the sale of Ncell by TeliaSonera Norway to Axiata UK.
With such issues, Ncell has won the 1800 Mhz bidding and will use the same 1800 band GSM band for 4G. As the company is facing tax issues, NTA had allowed Ncell’s participation in the spectrum auction today only on the condition that it will use additional spectrum in the given bandwidth (if it becomes the highest bidder) only after it clears all its tax liabilities, including capital gains tax. The spectrum auction notice had mentioned that telecom companies had to either have a basic telephony service license or unified license, clear all dues including royalty, RTDF and spectrum fees to be eligible to participate.
It seems Ncell is playing its cards right balancing the Nepal Government and international community using appropriate cards of paying tax and then as soon as the bidding for the 1800 MHz is over bringing in the international community to stop the process of CGT.
Ncell from the past has a history of tax fraud and VAT fake bills issue and represent a capitalist business model targeting, lobbying and syndicating political manipulation and use.
