The tax department in India has given Vodafone 30 days to pay a tax bill of 112 billion rupees ($US2.5 billion), as part of an ongoing tax dispute.
The demand relates to the company's purchase of the Indian telephone assets of Hong Kong conglomerate Hutchison Whampoa in 2007.
Vodafone will appeal against the tax at the Indian supreme court on Monday.
The company says the $US11 billion transaction was exempt from tax because it took place between two offshore entities.
But the Indian tax department now says that Vodafone must pay the capital gains tax, and has sent the company a formal tax demand.
Vodafone is one of the biggest mobile operators in India, with 116 million customers, by virtue of a partnership with theEssar group, a domestic company.
