Open Access Research Article
DIGITAL TAXATION IN INDIA: CONSTITUTIONAL LEGITIMACY OF EQUALISATION LEVY, SIGNIFICANT ECONOMIC PRESENCE AND SEARCH & SEIZURE UNDER INCOME TAX ACT
Abstract
Digital Taxation in India was introduced in
the year 2016 by way of the Finance Act, 2016. The Digital Taxation was a core concept
authorising the Government of India to tax the e-commerce operators, social
media operators, digital virtual space operators and digital platforms in
India. Because of the traditional taxation system on foreign companies involved
in e-commerce and digital platforms, the Government of India implemented Equalisation
Levy in the year 2016 and has dropped the same in the year 2024. At the same
time, it has adopted Significant Economic Presence in the year 2018 and it was
introduced in Section 9(1)(i) of the Income Tax Act, 1961 and later implemented
with some amendments in the present Income Tax Act, 2025. The significant economic
presence reveals that, the digital taxation is carried out based on substantial
economic presence or economic activity carried out by non-resident entities in
India without the physical presence. For the past few years, there were some
questions arose regarding the constitutional validity and Legal validity of
digital taxation law in India. There were also critics saying that, India is
not following right to privacy assured by the Supreme Court of India, under
Articles 14 and 21 of the Constitution of India, 1950 in Search and Seizure
procedures and it amounts to Executive overreach and violates the doctrine of
Proportionality. Hence, under the circumstances of above questions in mind, this
study is carried out regarding the legal validity in implementation of Digital
Services Taxation in India and its constitutional legitimacy on Equalisation
Levy, Significant Economic Presence and some other issues like search and
seizure, Double Taxation and adaption of International Treaties regarding
Digital Services taxation in India.
Published Paper
Author Details
Authors: K. GNANA SAMBANDANRegistration ID: 1013521 | Published Paper ID: IJLRA13521Approved ISSN: 2582-6433 | Country: Delhi, India
Article Information
DIGITAL TAXATION IN INDIA: CONSTITUTIONAL LEGITIMACY OF EQUALISATION LEVY, SIGNIFICANT ECONOMIC PRESENCE AND SEARCH & SEIZURE UNDER INCOME TAX ACT
Authors: K. GNANA SAMBANDAN
- Journal IJLRA
- ISSN 2582-6433
- Volume 3
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- AbbreviationIJLRA
- ISSN2582-6433
- AccessOpen Access
- LicenseCC 4.0
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