Nepal Government Wins Tax Dispute Case Against Ncell

The Nepal government has emerged victorious in the tax dispute case of Ncell, the leading telecommunication company in the country.

The International Center for the Settlement of Investment Disputes (ICSID), an esteemed international institution responsible for resolving investment disputes under the auspices of the World Bank, has dismissed the case filed by Axiata Group Berhad, the parent company of Ncell, against the Government of Nepal regarding a tax dispute.

The dispute primarily revolved around capital gain taxes associated with share sales. In response to the disagreement, Axiata pursued legal action by filing a petition against the Inland Revenue Department of Nepal at the ICSID.

Ncell had previously sought arbitration through a formal request to an international body, alleging that the capital gains tax imposed on the company by the government was in violation of international laws and treaties.

Government data reveals that during the ownership transfer of Ncell from the Swedish company TeliaSonera to the Malaysian company Axiata in the year 2072, a profit of Rs 1 trillion 43 billion was recorded.

Mr. Dirgaraj Mainali, the Director General of the Internal Revenue Department, provided insight into the matter by stating that if interest is calculated at the prevailing rate of 15 percent, Ncell would be liable to pay an additional sum of Rs 45 billion.