CC, Linklaters in tax row

Clifford Chance is appealing a decision by an Indian tax tribunal that it has underpaid on tax

It is part of a wider dispute involving other law firms, including Linklaters, and the Inland Revenue has been in talks with the Indian tax authorities seeking a breakthrough.
The Law Society is appealing to the Indian High Commissioner to halt the subcontinent's request for greater tax levies on certain Western law firms.
Clifford Chance declined to show a copy of the tax tribunal's judgment, due to be published in several weeks time. It denies a Law Society statement saying the judgment means Clifford Chance will be taxed on its global earnings. The Law Society statement was later changed.
Clifford Chance chief financial officer Chris Merry told The Lawyer: “The court judgment stated that they don't agree with the amount of revenue we're putting into India based on how much time our partners spend in India doing transaction work.”
A source said the meeting between the Inland Revenue and Indian officials also aims to resolve the issue of double taxation.
The Double Tax Treaty between the UK and India stops firms from paying tax in two jurisdictions. “The fact that they don't have an office in India is one of the relevant factors here,” said the source.
Deloitte & Touche is understood to be advising both firms in the dispute.
The level of taxation is generally based on the length of time a lawyer physically spends in India working on a project.