Vodafone case: PIL accuses CJI of conflict of interest

FP

The Supreme Court is scrutinising a PIL seeking "re-confirmation" on whether Hoshnar Kapadia, a chartered accountant employed at Ernst and Young, is the son of Chief Justice of India Sarosh Homi Kapadia.

The petition filed by advocate Manohar Lal Sharma alleges that if Hoshnar, senior manager at Ernst and Young (India), is indeed identified as the CJI's son, it would mean that Kapadia had all along heard the Vodafone tax case without having disclosed that his son worked at the very consultancy firm that advised Vodafone Group in 2007 on Hutchison Whampoa Ltd deal.

On January 20, 2012, a majority judgment authored by Chief Justice Kapadia had declared that the Income Tax department has no jurisdiction to tax the $11.076-billion offshore deal.

The petition alleges foul play by telecom and finance ministries, Vodafone, Hutchison Whampoa and Analjit Singh, the newly appointed chairman of Vodafone India Ltd.

It comes shortly after the government has filed for a review of the January 20 judgment.

"The SC judgment dated January 20, 2012 has considered due diligence report filed by Ernst and Young in which Hoshnar is also working as a senior manager since 2008. It is also true that our Chief Justice of India has a son, Hoshnar Kapadia, who is also a chartered accountant. It is a subject matter of re-conformation whether he is the son of our honourable CJI or not," Sharma's PIL says. Sharma says if the "answer is 'yes'" to his question, an "unexpected scenario" arises whereby the CJI's judgment in the case should be scrapped and the matter be posted for fresh hearing before a constitutional bench.

Sharma adds that he has "no doubt about the integrity or honesty of our CJI". Official sources declined to comment on the issue.

"Hoshnar was not with E&Y India when E&Y UK gave advice to Vodafone from December 2006 to May 2008. He was with a competing firm, KPMG, at the time. Hoshnar had joined E&Y India on July 9, 2008. E&Y is a large multinational and Hoshnar works in the financial sector vertical of E&Y India, which had nothing to do with the department that gave the advice. What is the conflict of interest here?" said advocate Harish Salve, who represented Vodafone in the tax litigation at the SC.

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