Ncell Scandal Unveiled: Allegations of Undervaluation, Tax Disputes, and Ownership Shenanigans

In recent developments, Ncell, a prominent telecom company in Nepal, has come under scrutiny for a series of controversies surrounding its acquisition, ownership transfer, and tax disputes. Here's a brief report on the unfolding saga:

1. Acquisition and Tax Disputes:

   - Ncell's acquisition by Axiata from TeliaSonera raised eyebrows with allegations of undervaluation and underpayment of taxes.

   - The Supreme Court's ruling holds Ncell and Axiata liable for tax payments, leading to legal complexities.

2. ICSID Orders and Axiata's Exit:

   - The International Centre for Settlement of Investment Disputes (ICSID) ordered Axiata and Ncell not to comply with the tribunal's payment order.

   - Spectrlite UK acquired Axiata's 80% stake in Ncell for $50 million, prompting Axiata's exit from Nepal due to a challenging operating environment and regulatory uncertainties.

3. Regulatory Challenges and Clean Exit:

   - Axiata's decision to withdraw was influenced by Nepal's regulatory challenges and tax environment.

   - The sale allowed Axiata a clean exit, transferring full responsibility and liabilities to Ncell's new owner while indemnifying against Nepalese tax claims.

4. Ownership Transfer and Tax Dispute Resolution:

   - Axiata acquired an 80% stake in Ncell in 2016, marking a significant transaction in Nepal's telecom industry.

   - Ncell faced a prolonged tax dispute with the Nepalese government over capital gains tax, with varied rulings and appeals.

5. Spectrlite's Role and Lack of Compliance:**

   - Spectrlite UK's recent acquisition of Ncell has raised concerns about compliance, as the transfer allegedly occurred without informing the Nepalese Telecommunications Authority (NTA).

   - Tax clearance issues further intensify as Ncell allegedly transferred ownership without settling outstanding tax liabilities.

6. Government Involvement and Lack of Transparency:

   - The creation of Spectrlite company for ownership passout from the government, involving politicians, adds a layer of complexity to the controversy.

   - Lack of transparency and failure to inform the NTA about the share transfer raise questions about corporate governance.

Conclusion:

The Ncell saga unfolds with layers of legal battles, ownership transfers, and regulatory challenges. The lack of clarity, allegations of tax evasion, and non-compliance with regulatory procedures demand a thorough investigation to ensure transparency and accountability in Nepal's telecom sector.