Summary✨
- The Supreme Court of Nepal issued an interim decision not to implement the previous verdict in the WorldLink tax evasion case.
- This decision reverses Attorney General Savita Bhandari’s earlier ruling, which did not prosecute WorldLink due to insufficient basis.
- The Department of Revenue Investigation accused WorldLink and other ISPs of not paying tax on maintenance fees.
- The new decision could lead to significant tax collection from ISPs as it brings the case back into focus.
The Supreme Court of Nepal has given an interim decision not to implement the decision regarding WorldLink’s tax evasion case. The decision reverses the previous verdict made by former Attorney General Savita Bhandari. A joint bench of Justices Binod Sharma and Shrikant Poudel issued the interim order, which could strike a major blow for the country’s top internet service provider (ISP) in this legal battle.
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WorldLink tax case withdrawal breaks again
Initially, the District Government Attorney’s Office, Lalitpur, had decided not to proceed with the case, and the Patan office upheld it. Then, it was followed by the then Attorney General Sabita Bhandari, who also gave the decision not to prosecute the internet giant, citing insufficient basis for prosecution. She held that the law was not clear on whether telecommunications service charges would be applicable to maintenance fees and that alternative measures were available under the self-assessment tax system. Opposing this decision, Bheshraj Luitel had filed a writ to reverse the decision.
The petition named the Office of the Prime Minister and Council of Ministers, NTA, IRD, the Department of Revenue Investigation, Attorney General’s Office, High Government Prosecutor’s Office, etc., etc., as defendants. It’s said that WorldLink might have to pay Rs 7.36 billion in taxes.
Department of Revenue Investigation concluded that some top ISPs in Nepal, including WorldLink, were not paying TSC on the amount collected from maintenance fees. On this basis, a case was lodged, but the former attorney general decided not to prosecute the company.
However, with the latest decision, the case has come to the surface again and affects WorldLink and other ISPs, too.
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The department has earlier recommended that the state should collect billions from the ISPs over the tax ‘evasion’. Now, the case will only sustain further, and it could entangle other Nepali ISPs too, as it concerns taxes and TSC fees.
