Against a tax claim in India,  Aberdeen Asset Management has filed a legal challenge. There is a dispute between the foreign fund management groups and the government over a retrospective taxes.

In response to a claim from Indian authorities, Aberdeen has filed its challenge at the High Court of Bombay. The Indian authorities have demanded a minimum alternative tax payment of “less than $50,000” for one of its funds.

Aberdeen’s Asia managing director, Hung Young said, the firm had decided to appeal the tax demand even though the litigation costs would likely exceed the penalty demanded by Indian authorities, calling it an issue of principle.

“We’ll probably end up spending a lot more on the legal challenge than the tax demand, but the point being that if you receive these and don’t challenge you can end up receiving a lot more,” Young said.