The Supreme Court's verdict directing Tiger Global to pay capital gains tax on its 2018 sale of Flipkart shares is unlikely to accelerate the selloff by foreign portfolio investors (FPIs). However, legal and tax experts say the ruling sharpens scrutiny around treaty benefits and could influence how offshore investors structure future India bets.
One of the key concerns of foreign investors is how the general anti-avoidance rule would apply in case an investor is availing benefits under double taxation avoidance agreement.
The comments come at a time when the Supreme Court-constituted Special Investigation Team has detected funds worth about Rs 4,479 crore (Rs 44.79 billion) held by Indians in a Swiss branch of HSBC bank, while unaccounted wealth totalling Rs 14,958 crore (Rs 149.58 billion) have been traced within home.
Khandaani Shafakhana neither enlightens nor entertains, feels Sukanya Verma.
Taxing SoftBank, the largest shareholder in Flipkart with a little over 20 per cent stake, however, will be easier.
The panel's recommendations will be aimed at making a predictable and non-adversarial tax regime in the economy.
Long accused of being a route for avoiding taxes for foreign investments into India, Mauritius says it has put additional safeguards in place to thwart such wrong perceptions and to boost its image as a preferred global financial centre.
Other forms of securities such as compulsorily convertible debentures (CCDs), optionally convertible debentures (OCDs) and some derivatives could remain out of the scope of the amendments
Mauritius wanted extension of the benefits limitation clause in India's treaty with Singapore, which we were quite willing to extend, for our price
Signing of the pact will hopefully end stock market uncertainty that came with the mention of the M-name
GAAR will not override the recently revised double taxation avoidance agreements with Mauritius and Singapore.
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