Telecoms giant Vodafone saw shares rise in early trading after the Indian Supreme Court ruled in the group's favour over a tax dispute.

Vodafone climbed 1.46 per cent, or 2.55p, to 177.05p at 9.30am.

In a short statement, the group confirmed, 'Vodafone has received the judgment of the Indian Supreme Court. 

'The Court has concluded that Vodafone had no liability to account for withholding tax on its acquisition of interests in Hutchison Essar Limited (now Vodafone India Limited) in 2007.'

The ruling means that India's tax office has no jurisdiction over Vodafone's US$11 billion (£7 billion) purchase of Hutchison, an Indian mobile phone business, in 2007.

The group lost the original court case and could have faced a tax bill of US$2.2 billion (£1.4 billion). Instead, it is set to receive a US$496 million (£320 million) refund.

In the UK, Vodafone has been accused of dodging a £6 billion tax bill, causing fierce protests from activists.

It is the second time this week that a tax ruling by the Indian Supreme Court has impacted on the FTSE 100. On Tuesday, shares in Essar Energy plunged after the Court ruled that the group faced an £807 million tax bill.