KATHMANDU, May 22: A case filed by the Ncell and its parent company Axiata Group for arbitration regarding the capital gains tax (CGT) assessed on the telecom company by the Government of Nepal has been officially registered at the International Centre for the Settlement of Investment Disputes (ICSID).
The Ncell, an institution under the World Bank, has accepted the arbitration case on Tuesday, according to the official website of the ICSID.
In their arbitration case, Ncell and Axiata have argued that Nepal’s conduct in relation to capital gains tax imposed on the mobile company is against the Bilateral Investment Treaty between Nepal and the UK.
In April third week, Ncell had filed a writ petition at the Supreme Court challenging the CGT assessed against it by the Large Taxpayers Office.
In its writ petition, the company claimed that the LTO has erroneously assessed its tax liability at Rs 39.06 billion. Ncell stated that the CGT stands only at Rs 14 billion as it is not responsible for interests and fines for delay in payment as the tax has just been assessed.
After assessing the CGT on the Ncell buyout deal, LTO had asked the company on April 23 to pay the remaining CGT amounting to Rs 39.06 billion, including interest and fines, within a week . LTO made its final assessment of the CGT on the buyout that took place three years ago after the Supreme Court issued a verdict on the matter in the first week of April.
Following the Supreme Court verdict, LTO assessed the CGT at Rs 62.63 billion and asked Ncell to clear the remaining amount payable of Rs 39 billion.