New Delhi, Nov 22 (IANS): The Supreme Court has dismissed the Special Leave Petition (SLP) filed by the Income Tax department against Reliance Communications (RCOM) on taxing of the proceeds of Foreign Currency Convertible Bonds (FCCBs), treating it as ‘unexplained cash credit, a company statement said here on Tuesday.

The Supreme Court decision came on Monday.

A Supreme Court bench of Justice Kurian Joseph and Justice Rohinton Fali Nariman passed the order dismissing the I-T department's SLP, in relation to taxing of the FCCB proceeds, interest and derivatives income or loss thereon.

"During financial year 2006-07, Reliance Communications had issued FCCBs, as per the extant guidelines of the Reserve Bank of India and applicable laws, aggregating $1.5 billion (Rs 6,485 crore). The Income-Tax department took the view to assess the FCCB proceeds as ‘unexplained cash credits' and had raised tax demands thereon," the company statement said.

"The Supreme Court order has quashed contingent tax liability of RCOM for about Rs 4,800 crore. Earlier, the Income-Tax Appellate Tribunal and the Bombay High Court had also upheld RCOM's appeal against the order of the Income-Tax department," it added.