"Even though it is only the legacy issues (concerning taxation) that haunt us, we recognise that we must put a quick end to them. I am considering a high-level committee to explore what can be done to resolve the past, and move beyond it in a way that would provide real predictability and certainty to investors," Jaitley wrote in an opinion piece in Financial Times.

This committee will be instructed to report back expeditiously so that early actions can be taken. They had fashioned tax policies for the 21st century. Our tax administration could not afford to lag behind. They would not let it, Jaitley said.

He cited the disputes now attracting attention are legacy cases, which are tax demands arising from actions that the tax authorities and the judiciary took before NDA government came
to power.

Explaining the levy MAT on foreign portfolio investors, Jaitley added the decision was taken not by the government but by quasi-judicial bodies, which were created — well before the present government came to power — to reassure investors that the tax system would be free of political interference.

Following a ruling by the AAR, the revenue department has sent notices to 68 foreign institutional investors (FIIs) for payment of dues totalling Rs 602.83 crore towards Minimum Alternate Tax (MAT).

"However, we have made clear that these rulings can be contested in higher courts, which will respect due process and have the power to quash faulty decisions. We also made clear that our international tax treaties cannot be overridden by these rulings," Jaitley said.

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