– it has a licence for 2,000 petrol pumps and is making big investments on the promise of possible deregulation of the sector, making it the only MNC in India with a license to run gas stations.
Like Vodafone, Shell India too argued the taxman has no jurisdiction as issuing of shares does not add to Shell’s income and is therefore not an international transaction. Shell India has also argued that there is absolutely no difference in its shareholding pattern after the share issue and that the shares were issued primarily to infuse capital.
Once again, the Finance Act of 2012 comes to the rescue and the transfer pricing order makes the same point as in the case of Vodafone. And in the case of Shell, R851 crore have been added to its income by raising the value per share to R187.96 on the basis of this transaction. All told, R3,137 crore has been added as transfer pricing adjustment for FY10, which includes R1,903 crore interest on the short receipt of R15,200 crore associated with FY09 share transaction.