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CORPORATE TAX AVOIDANCE IN INDIA: NAVIGATING THE GREY AREAS BETWEEN LEGITIMATE TAX PLANNING AND AVOIDANCE AUTHORED
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CORPORATE
TAX AVOIDANCE IN INDIA: NAVIGATING THE GREY AREAS BETWEEN LEGITIMATE TAX
PLANNING AND AVOIDANCE
AUTHORED BY
- SANYAM M SURANA
ABSTRACT
The paper explores the conflict
between lawful tax planning and potentially exploitative tax avoidance tactics
related to corporate tax avoidance in India. This study examines how Indian
courts have construed and implemented anti-avoidance concepts by examining
significant court rulings, legislative actions, and administrative procedures.
This study examines the adoption of the General Anti-Avoidance Rule (GAAR), the
Vodafone case's aftermath, and the difficulties presented by new business
models in the digital economy. By analyzing the conceptual frameworks employed
by Indian courts to differentiate between legal tax planning and illegal tax
evasion, this study adds to the knowledge of corporate taxation in emerging
nations with intricate legal systems. Although India has made significant
progress in combating aggressive tax avoidance, the results indicate that
finding a balanced strategy that preserves tax sovereignty while encouraging
investment and economic expansion will continue to present substantial obstacles.
Keywords: Tax avoidance, GAAR, treaty
shopping, Vodafone case, retrospective taxation, transfer pricing, digital
economy taxation
I.
INTRODUCTION
Corporate tax avoidance is one of the
most controversial aspects of tax law, which lies in the gray area between
lawful tax planning and unlawful tax cheating. The problem of combating
corporate tax evasion while preserving an alluring investment environment poses
unique challenges for India, a rising nation with high revenue demands and a convoluted
history of economic liberalization. India's approach to corporate taxation has
important ramifications for both local revenue mobilization and global tax
policy, given that the country has one of the fastest-growing major economies
in the world.
The Vodafone case, which finally
resulted in contentious retroactive revisions to the Income Tax Act of 1961,
brought corporate tax avoidance in India to the world's attention. Since then,
India has implemented several legal and administrative changes to give
taxpayers more stability while reducing aggressive tax dodging methods.[1] India's
evolving response to complex tax planning structures is shown in the General
Anti-Avoidance Rule (GAAR), which was introduced in 2017, changes to Double
taxing Avoidance Agreements (DTAAs), and new taxing strategies for the digital
economy.
This study looks at how Indian
lawmakers, courts, and tax authorities deal with the intricate problem of
corporate tax evasion. It investigates the conceptual frameworks that
differentiate between abusive tax avoidance and lawful tax planning by
examining significant court rulings, legislative developments, and
administrative procedures. The research advances knowledge of how emerging
nations strike a compromise between revenue needs and investment promotion
goals by placing these developments within more extensive international
discussions on base erosion and profit shifting.
II.
THEORETICAL FRAMEWORK: THE LEGITIMACY SPECTRUM IN TAX PLANNING
A. Permissible Tax Planning vs. Impermissible Tax Avoidance
The difference between legal tax
planning and illegal tax avoidance has received much court attention in India.
In McDowell & Co. v. Commercial Tax Officer, the Supreme Court
substantially shifted from previous methods by stating that the courts should
not approve tax planning strategies that aim to subvert legislative intent.[2] An
early framework for examining avoidance transactions was created by Justice Misra's
frequently cited statement that "colorable devices cannot be part of tax
planning" but "tax planning may be legitimate provided it is within
the framework of law."
In Union of India v. Azadi Bachao
Andolan, the Supreme Court took a more lenient stance on tax planning, which
caused the pendulum to swing in the other direction. With the observation that
"there is nothing sinister in so arranging affairs as to keep taxes as low
as possible," the Court acknowledged that taxpayers have the freedom to
organize their affairs to reduce their tax liability.[3]
The theoretical conflict between the
McDowell and Azadi Bachao Andolan methods has produced an established framework
for evaluating the validity of tax planning arrangements in India. The Supreme
Court attempted to reconcile these perspectives in Vodafone International
Holdings B.V. v. Union of India[4],
acknowledging that "there is a difference between pre-ordained
transactions created for tax avoidance purposes and genuine strategic tax
planning."
B. Doctrine of Form vs. Substance in Indian Jurisprudence
In Indian tax law, the doctrine of
substance above form has been interpreted in a variety of ways. Indian courts
have historically been more hesitant to reject the legal form of transactions
based only on their economic substance, in contrast to countries like the US
where the economic substance doctrine has been codified. In general, the Indian
legal system respects the format that taxpayers choose for their transactions,
only becoming involved where the arrangement seems fraudulent or completely
devoid of any commercial substance.
Although the courts have the power to
look beyond form in circumstances of obvious misuse, this conservative approach
reflects their support of taxpayers' right to set up their affairs to reduce
tax liabilities. Indian jurisprudence has developed over time to achieve a
balance between upholding legal company structures and prohibiting fictitious
agreements made just to evade taxes. In Indian tax litigation, the conflict
between form and content is still a major subject. Courts are becoming more
ready to consider the economic realities of transactions while still demanding
strong evidence before rejecting their legal form.
The principle of substance above form
has been interpreted in various ways. Indian courts have historically been more
hesitant to ignore the legal form of transactions based only on their economic
substance, in contrast to countries like the United States where the economic
substance doctrine has been codified.[5]
The Supreme Court provided further
clarity in CIT v. Walfort Share and Stock Brokers P. Ltd., where it
distinguished between legitimate tax planning and colorable devices, noting
that "the form adopted by the parties could be disregarded if the same was
only a subterfuge to avoid payment of tax."[6]
III. GENERAL
ANTI-AVOIDANCE RULE (GAAR) IMPLEMENTATION AND EFFECTIVENESS
A. Legislative History and Framework of GAAR
After several delays and
modifications, India incorporated the General Anti-Avoidance Rule (GAAR) into
the Income Tax Act through the Finance Act, 2013, effective April 1, 2017.[7] The
introduction of GAAR represented a significant shift in India's approach to tax
avoidance, providing tax authorities with broad powers to recharacterize
transactions that lack commercial substance.
Section 95[8] of
the Income Tax Act empowers tax authorities to declare an arrangement as an
"impermissible avoidance arrangement" if its primary purpose is to
obtain a tax benefit and contains certain tainted elements specified in Section
96[9].
These include elements that create rights or obligations not typically created
between parties dealing at arm's length, result in misuse or abuse of
provisions of tax laws, lack commercial substance, or are carried out in a
manner not ordinarily employed for bona fide purposes.
The GAAR provisions are notable for
their broad scope and the significant discretionary powers they confer on tax
authorities. Section 97[10]
provides an inclusive definition of "lack of commercial substance."
In contrast, Section 98[11]
specifies the impermissible consequences of an arrangement, including
disregarding or recharacterizing the arrangement, reallocating income and
expenses, or treating an asset's place of residence or situation differently.
B. Safeguards and Limitations in GAAR Application
Recognizing the potential for
uncertainty and disputes arising from the broad scope of GAAR, the legislature
incorporated several safeguards. Rule 10U of the Income Tax Rules provides that
GAAR shall not apply to arrangements where the tax benefit does not exceed INR
3 crore to foreign institutional investors who do not claim treaty benefits or
to investments made before April 1, 2017.[12]
Furthermore, Section 144BA
establishes a multi-layered approval process before GAAR can be invoked. The
Assessing Officer must refer the matter to the Principal Commissioner or
Commissioner, who may refer it to an Approving Panel comprising three members.
This procedural safeguard aims to prevent arbitrary application of GAAR
provisions.
The Central Board of Direct Taxes
(CBDT) has also issued Circular No. 7 of 2017, clarifying the implementation of
GAAR.[13] Notably,
the circular clarifies that GAAR will not interplay with the right of the
taxpayer to select or choose a method of implementing a transaction and that it
will not apply where Specific Anti-Avoidance Rules (SAAR) are already
applicable.
C. Early Jurisprudence and Application
While GAAR is relatively new in the
Indian context, early indications suggest that tax authorities have been
cautious in its application. As of 2023, no reported judicial decisions have
directly addressed the application of GAAR provisions. This cautious approach
may reflect the government's recognition of the potential for uncertainty and
disputes arising from the aggressive application of these provisions.
However, the Authority for Advance
Rulings (AAR) has considered potential GAAR implications in several rulings. In
Mahindra & Mahindra Financial Services Ltd., In re,[^12], the AAR
noted that where a transaction has commercial substance beyond tax benefits, GAAR
may not be applicable. Similarly, in Tiger Global International II Holdings,
In re,[^13], the AAR examined a multi-layered structure for a potential
GAAR application, though it ultimately decided the case on other grounds.
The limited jurisprudence on GAAR
thus far suggests that both tax authorities and judicial bodies are proceeding
cautiously, recognizing the significant implications of these provisions for
taxpayer certainty and investment climate.
IV. THE
VODAFONE CASE AND RETROSPECTIVE TAXATION
A. The Original Dispute and Supreme Court Decision
The Vodafone case represents perhaps
the most significant tax dispute in Indian history, with far-reaching
implications for foreign investment and tax policy. The dispute arose from
Vodafone International Holdings B.V.'s acquisition of a 67% stake in Hutchison
Essar Limited (an Indian company) through purchasing shares in a Cayman Islands
company in 2007. The Indian tax authorities sought to tax the capital gains
arising from this transaction, arguing that Vodafone should have withheld tax
on the payment made to Hutchison.
After protracted litigation, the
Supreme Court delivered its landmark judgment in Vodafone International
Holdings B.V. v. Union of India[14]
in January 2012. In a comprehensive analysis of cross-border taxation and the
limits of tax planning, the Court held that the transaction was not taxable in
India. The Court observed that "the Revenue cannot tax a subject without a
statute. If the Revenue seeks to tax a foreign company, there has to be some nexus
with India."
The Court emphasized that the
transaction involved the transfer of shares of a foreign company between two
non-residents and that the situs of these shares was outside India. The Court
rejected the "look through" approach advocated by the tax
authorities, holding that "the Revenue cannot go behind the corporate veil
in order to examine the substance of the transaction unless the transaction is
a sham or is illegal or prohibited by law."
B. Retrospective Amendment and Its Constitutional Validity
In an unprecedented response to the
Supreme Court's decision, the government introduced retrospective amendments to
the Income Tax Act through the Finance Act 2012.[15]
The amendments to Section 9(1)(i) of the Act, read with Explanation 5,
clarified that an offshore transfer of shares would be taxable in India if the
shares derived their value "substantially" from assets located in
India.
The retrospective amendments sparked
significant controversy and were challenged on constitutional grounds. In Vodafone
International Holdings B.V. v. Union of India,[16] a
writ petition challenging the constitutional validity of these amendments, the
Bombay High Court initially declined to grant interim relief. However, before
the substantive constitutional challenge could be decided, the dispute moved to
international arbitration.
The retrospective amendments have
been criticized for undermining legal certainty and the rule of law. In Nokia
India Pvt. Ltd. v. Dy. CIT,the Delhi High Court observed that
"retrospective legislation defeats the principle of legislative certainty,
which is the foundation for the rule of law."[17]
Similarly, in CIT v. Vatika Township Pvt. Ltd., the Supreme Court noted
that "a provision of a statute would be within the powers of the
legislature and yet be arbitrary or discriminatory and unconstitutional."[18]
C. International Arbitration and Recent Developments
The retrospective taxation dispute
ultimately moved to international arbitration under the India-Netherlands
Bilateral Investment Treaty. In September 2020, the Permanent Court of
Arbitration at The Hague ruled in favor of Vodafone, holding that the
retrospective tax demand breached the "fair and equitable treatment"
standard guaranteed under the treaty.[19]
In response to mounting international
pressure and adverse arbitration awards, the Indian government enacted the
Taxation Laws (Amendment) Act, 2021[20],
which nullified the retrospective tax demands subject to certain conditions,
including the withdrawal of all litigation and claims for damages. This legislation
marked a significant reversal of the government's position and aimed to restore
investor confidence.
The Vodafone saga illustrates the
complex interactions between domestic tax sovereignty, international investment
law, and the rule of law principles. It highlights the challenges faced by
emerging economies in balancing revenue needs with the imperative to maintain a
stable and predictable investment environment.
V. TREATY
SHOPPING AND LIMITATIONS OF BENEFITS PROVISIONS
A. India's Approach to Treaty Shopping
Treaty shopping has been a
significant concern for Indian tax authorities; particularly investments routed
through jurisdictions with favorable tax treaties. Historically, a substantial
portion of foreign investment into India has been channeled through Mauritius,
Singapore, and Cyprus. This is mainly due to the capital gains tax exemptions
available under the respective tax treaties.
The Supreme Court's decision in Union
of India v. Azadi Bachao Andolan[[21]
effectively legitimized treaty shopping by upholding the validity of Circular
No. 789 of 2000, which provided that a certificate of residence issued by
Mauritian authorities would constitute sufficient evidence of residence and
beneficial ownership for claiming treaty benefits. The Court observed that
"there is no prohibition against treaty shopping in the Indo-Mauritius
Double Tax Avoidance Convention (DTAC)."
However, subsequent developments
reflect India's changing approach to treaty shopping. In Aditya Birla Nuvo
Ltd. v. Dy. DIT,[22]
the Authority for Advance Rulings denied treaty benefits to a transaction
structured through Mauritius, noting that "the transaction lacks any nexus
with Mauritius, being only for the creation of a device to seek tax
benefit."
B. Amendments to Double Taxation Avoidance Agreements
In response to concerns about revenue
loss through treaty shopping, India has renegotiated several key tax treaties
to incorporate Limitation of Benefits (LOB) provisions. The Protocol amending
the India-Mauritius tax treaty, signed in 2016, introduced a significant change
by providing source-based taxation of capital gains arising from alienation of
shares acquired on or after April 1, 2017.[23]
Similar amendments to the tax treaties with Singapore and Cyprus were made.
These amendments represent a
significant shift in India's approach to international taxation, aligning more
closely with the principles advocated by the OECD's Base Erosion and Profit
Shifting (BEPS) project. The introduction of LOB provisions reflects a growing
recognition that treaty benefits should be available only to entities with a
substantive economic presence in the treaty partner jurisdiction.
The Delhi High Court in Serco BPO
Private Limited v. AAR acknowledged this shift, observing that "treaty
shopping, though not illegal per se, is increasingly being viewed as defeating
the object and purpose of tax treaties."[24]
C. Judicial Interpretation of Principal Purpose Test
The introduction of the Principal
Purpose Test (PPT) in India's tax treaties, in line with the Multilateral
Instrument to Implement Tax Treaty Related Measures to Prevent BEPS (MLI),
represents another significant development. The PPT denies treaty benefits if
it is reasonable to conclude that obtaining such benefits was one of the principal
purposes of an arrangement or transaction.
Indian courts have begun to develop
jurisprudence on the application of the PPT. In Bid Services Division
(Mauritius) Ltd., the Authority for Advance Rulings considered whether a
Mauritian entity could claim treaty benefits for investments in India. The AAR
noted that "the mere fact that an entity is a resident of a Contracting
State does not automatically entitle it to the benefits of the DTAA if the
arrangement is primarily tax-driven."[25]
Similarly, in AB Holdings,
Mauritius-II, In re, the AAR examined whether a Mauritian investment
vehicle established by a Swedish group could claim treaty benefits. The AAR
focused on the commercial rationale for the structure, noting that "the
question as to whether treaty shopping is impermissible would depend on the
facts and circumstances of each case."[26]
This evolving jurisprudence suggests
a more nuanced approach to treaty shopping, with courts increasingly willing to
scrutinize the substance of arrangements to determine eligibility for treaty
benefits.
VI.
TRANSFER PRICING REGULATIONS AND PROFIT SHIFTING
A. Evolution of India's Transfer Pricing Framework
India introduced comprehensive
transfer pricing regulations through the Finance Act 2001 by inserting Sections
92 to 92F in the Income Tax Act.[27]
These provisions require that international transactions between associated
enterprises be carried out at arm's length prices and provide for methods to
determine such prices.
The transfer pricing framework has
been progressively strengthened, with the introduction of Advance Pricing
Agreements (APAs) in 2012,[28]
the expansion of transfer pricing provisions to specified domestic transactions
in 2013,[29] and the
introduction of Country-by-Country Reporting requirements in 2016 in line with
BEPS Action 13.[30]
Indian courts have played a
significant role in shaping the application of transfer pricing rules. In Sony
Ericsson Mobile Communications India Pvt. Ltd. v. CIT, the Delhi High Court
provided important guidance on selecting comparables and calculating arm's
length price. The Court observed that "transfer pricing regulations is to
prevent shifting of profits outside India and not to encourage bringing of
non-existent income to tax in India."[31]
B. Judicial Approaches to Intangibles and Hard-to-Value
Assets
Transfer pricing of intangibles has
been a particularly contentious area, with significant litigation around the
valuation of intellectual property rights and other hard-to-value assets. The
Delhi High Court in Bausch & Lomb Eyecare (India) Pvt. Ltd. v. Addl. CIT
addressed the complex issue of marketing intangibles, holding that "the
existence of an international transaction involving the creation of marketing
intangibles cannot be presumed merely because an Indian entity has incurred AMP
expenses."[32]
In CIT v. L'Oreal India Pvt. Ltd.,
the Bombay High Court rejected the notion that advertising, marketing, and
promotion expenses exceeding those of comparable companies automatically
constitute an international transaction requiring transfer pricing adjustment.[33]
These judicial decisions reflect a
growing sophistication in the treatment of intangibles and recognition of the
need for nuanced approaches to their valuation in transfer pricing analyses.
C. Safe Harbor Rules and Advance Pricing Agreements
India has introduced safe harbor
rules and an Advance Pricing Agreement (APA) program to provide certainty to
taxpayers and reduce transfer pricing disputes. The safe harbor rules, first
introduced in 2013 and subsequently revised, provide predetermined margins for
certain categories of international transactions, which, if adopted by
taxpayers, will be accepted by tax authorities without further scrutiny.[34]
The APA program, introduced in 2012,
allows taxpayers to obtain certainty regarding the transfer pricing methodology
and arm's length price for their international transactions for future years.
The program has been relatively successful, with the CBDT reporting the conclusion
of 300 APAs (including 270 unilateral APAs and 30 bilateral APAs) by March
2021.[35]
The Delhi High Court in Convergys
Customer Management Group Inc. v. ADIT acknowledged the value of APAs in
providing certainty, observing that "the APA program is a step towards
creating a non-adversarial tax regime."[36]
These administrative mechanisms
represent important complements to the judicial system in addressing transfer
pricing disputes, providing taxpayers with alternatives to protracted
litigation.
VII.
DIGITAL ECONOMY TAXATION CHALLENGES
A. Equalization Levy and Its Evolution
India was among the first countries
to introduce unilateral measures to tax the digital economy, with the
introduction of the Equalization Levy in 2016.[37]
Initially imposing a 6% levy on payments for online advertising services to
non-resident entities, the scope was significantly expanded in 2020 to cover
non-resident e-commerce operators with a 2% levy on the amount of consideration
received or receivable by an e-commerce operator from e-commerce supply or
services.[38]
The constitutional validity of the
Equalization Levy has been challenged in Google India Pvt. Ltd. v. Union of
India,[39] where
the petitioner argued that the levy was beyond the legislative competence of
Parliament as it was neither a tax on income nor an indirect tax. The matter is
currently pending before the Karnataka High Court.
The Equalization Levy represents
India's attempt to address the taxation challenges posed by digitalization in
the absence of international consensus. Its expansion in 2020, despite ongoing
OECD-led negotiations on Pillar One and Pillar Two solutions, reflects India's
determination to protect its tax base.
B. Significant Economic Presence and Nexus-Based Taxation
Complementing the Equalization Levy,
India introduced the concept of "Significant Economic Presence" (SEP)
through an amendment to Section 9(1)(i) of the Income Tax Act in 2018.[40] This
provision expands the definition of "business connection" to include
a non-resident's digital presence in India, even without a physical presence.
The threshold for SEP was defined in
2021 as Revenue exceeding INR 2 crore from transactions with Indian residents
or systematic and continuous solicitation of business activities with 300,000
users in India.[41] This
approach aligns with international efforts to redefine nexus rules for the
digital economy, though it goes beyond the consensus-based solution developed
at the OECD. The SEP provision and the Equalization Levy represent India's
multi-pronged approach to addressing the tax challenges arising from the
digitalization of the economy.
C. India's Position on Global Digital Tax Initiatives
India has actively participated in
global discussions on digital economy taxation, mainly through the OECD/G20
Inclusive Framework on BEPS. While supporting the broad objectives of the
Two-Pillar Solution, India has advocated for a more equitable allocation of
taxing rights that would benefit developing countries.
In Mastercard Asia Pacific Pte.
Ltd. v. ADIT,[42]
the Authority for Advance Rulings addressed the permanent establishment issue
in the context of digital payment services. The AAR held that the applicant had
a permanent establishment in India due to the presence of essential equipment,
even though it did not have a traditional fixed place of business.
Similarly, in Google India Pvt.
Ltd. v. ACIT,[43]
the Income Tax Appellate Tribunal addressed the characterization of payments
for advertising services on Google's platform, holding that such payments
constituted royalty subject to withholding tax obligations.
These judicial decisions reflect
India's assertive stance on digital economy taxation, which parallels its
position in international negotiations. India's approach is guided by the
principle that profits should be taxed where value is created, with particular
emphasis on market jurisdictions where users and consumers are located.
VIII.
CONCLUSION
India's approach to corporate tax
avoidance reflects the complex balancing act faced by developing economies. On
one hand, there is a legitimate need to protect the tax base and ensure that
multinational enterprises pay their fair share of taxes. On the other hand,
there is an equally important imperative to maintain a stable, predictable, and
attractive investment climate.
The introduction of GAAR,
modifications to tax treaties, expansion of transfer pricing regulations, and
initiatives in digital economy taxation all represent steps toward a more
robust anti-avoidance framework. However, the retrospective taxation
controversy and subsequent reversal demonstrate the potential pitfalls of
overly aggressive approaches to tax enforcement.
Indian courts have played a crucial
role in navigating this complex terrain, developing jurisprudence that
generally respects the form of transactions while being increasingly willing to
scrutinize their substance in cases of apparent abuse. The evolution from McDowell
to Azadi Bachao Andolan to Vodafone reflects a nuanced judicial
approach that recognizes the legitimacy of tax planning while setting limits on
abusive practices.
India's approach to corporate tax
avoidance will likely evolve in response to domestic priorities and
international developments. Implementing the Two-Pillar Solution to address tax
challenges arising from the digitalization of the economy, ongoing reforms to
transfer pricing practices, and the practical application of GAAR will shape
the contours of India's anti-avoidance framework in the coming years.
The key takeaway for corporate
taxpayers navigating this complex landscape is the increasing importance of
substance over form in tax planning arrangements. Structures that lack
commercial rationale beyond tax benefits are increasingly likely to face
scrutiny, whether under GAAR, transfer pricing regulations or treaty anti-abuse
provisions.
As India continues to assert its tax
sovereignty while integrating into the global economy, finding the appropriate
balance between these sometimes competing objectives will remain a central
challenge for policymakers, courts, and tax authorities.
[1] Vodafone International Holdings
B.V. v. Union of India & Anr., (2012) 6 SCC 613.
[2] McDowell & Co. v. Commercial
Tax Officer, (1985) 3 SCC 230.
[3] Union of India v. Azadi Bachao
Andolan, (2004) 10 SCC 1.
[4] Supra 1
[5] Internal Revenue Code § 7701(o)
(2018).
[6] CIT v. Walfort Share and Stock
Brokers P. Ltd., (2010) 326 ITR 1 (SC).
[7] Income Tax Act, 1961, §§ 95-102,
as amended by Finance Act, 2013.
[8] Income Tax Act, 1961, § 95
[9] Income Tax Act, 1961, § 96
[10] Income Tax Act, 1961, § 97
[11] Income Tax Act, 1961, § 98
[12] Income Tax Rules, 1962, Rule
10U.
[13] CBDT Circular No. 7 of 2017,
dated January 27, 2017.
[14] Supra 1
[15] Finance Act, 2012, § 4, read
with Explanation 5 to § 9(1)(i) of the Income Tax Act, 1961.
[16] Vodafone International Holdings
B.V. v. Union of India, (2014) 368 ITR 1 (Bom).
[17] Nokia India Pvt. Ltd. v. Dy.
CIT, (2013) 358 ITR 259 (Del).
[18] CIT v. Vatika Township Pvt.
Ltd., (2015) 1 SCC 1.
[19] Vodafone International Holdings
B.V. v. Republic of India, PCA Case No. 2016-35, Award (September 25, 2020).
[20] Taxation Laws (Amendment) Act,
2021, No. 34 of 2021.
[21] Union of India v. Azadi Bachao
Andolan, (2004) 10 SCC 1.
[22] Aditya Birla Nuvo Ltd. v. Dy.
DIT, (2011) 342 ITR 308 (AAR).
[23] Protocol amending the Convention
between the Government of the Republic of India and the Government of Mauritius
to avoid double taxation and prevent fiscal evasion concerning taxes on income
and capital gains, signed on May 10, 2016.
[24] Serco BPO Private Limited v.
AAR, (2015) 379 ITR 256 (Del).
[25] Bid Services Division
(Mauritius) Ltd., In re, (2020) 424 ITR 1 (AAR).
[26] AB Holdings, Mauritius-II, In
re, (2018) 407 ITR 1 (AAR).
[27] Income Tax Act, 1961, §§ 92-92F,
as inserted by Finance Act, 2001.
[28] Income Tax Act, 1961, §§ 92CC
and 92CD, as inserted by Finance Act, 2012.
[29] Income Tax Act, 1961, § 92BA, as
inserted by Finance Act, 2012.
[30] Income Tax Act, 1961, § 286, as
inserted by Finance Act, 2016.
[31] Sony Ericsson Mobile
Communications India Pvt. Ltd. v. CIT, (2015) 374 ITR 118 (Del).
[32] Bausch & Lomb Eyecare
(India) Pvt. Ltd. v. Addl. CIT, (2016) 381 ITR 227 (Del).
[33] CIT v. L'Oreal India Pvt. Ltd.,
(2016) 383 ITR 112 (Bom).
[34] Income Tax Rules, 1962, Rules
10TA to 10TG.
[35] Central Board of Direct Taxes,
Annual Report on Advance Pricing Agreement Program, 2020-21.
[36] Convergys Customer Management
Group Inc. v. ADIT, (2013) 212 Taxman 216 (Del).
[37] Finance Act, 2016, Chapter VIII
(§§ 163-180).
[38] Finance Act, 2020, § 165A.
[39] Google India Pvt. Ltd. v. Union
of India, W.P. No. 53663 of 2018 (Kar HC).
[40] Income Tax Act, 1961,
Explanation 2A to § 9(1)(i), as inserted by Finance Act, 2018.
[41] Income Tax Rules, 1962, Rule
11UD.
[42] Mastercard Asia Pacific Pte.
Ltd. v. ADIT, (2018) 406 ITR 43 (AAR).
[43] Google India Pvt. Ltd. v. ACIT, ITA No.
1190/Bang/2014 (ITAT Bangalore).
Article Information
CORPORATE TAX AVOIDANCE IN INDIA: NAVIGATING THE GREY AREAS BETWEEN LEGITIMATE TAX PLANNING AND AVOIDANCE AUTHORED
Authors: SANYAM M SURANA
- Journal IJLRA
- ISSN 2582-6433
- Published 2025/03/24
- Issue 7
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International Journal for Legal Research and Analysis
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- ISSN 2582-6433
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