• Service: Tax, International Executive Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 9/30/2013

India - Companies (unlisted) may be listed on foreign exchanges 

September 30: The KPMG member firm in India prepared reports on the following developments (read the September 2013 reports by clicking on the hyperlinks provided below):
  • Unlisted Indian companies may be listed, raise capital on foreign exchanges - India’s Ministry of Finance announced in late September 2013 that “unlisted Indian companies” may raise capital abroad without first having also to be listed on an exchange in India. Before this policy change, unlisted Indian companies were not allowed to be listed on foreign stock exchanges.

    Read a September 2013 report [PDF 387 KB]

  • Service tax amnesty - Under a 2013 service tax amnesty program, taxpayers may be allowed a one-time waiver of interest and penalties and be granted immunity from prosecution for non-payment of service tax, on payment of the service tax owed. The Allahabad High Court held that when a taxpayer filed an amnesty application (even if made after a demand notice/order was issued), the tax authorities cannot initiate recovery proceedings until the amnesty application is addressed and disposed off by the tax authorities.

    The case is: Anand Caterer. Read a September 2013 report [PDF 434 KB]

  • Rules for application of GAAR - India’s general anti-avoidance rules (GAAR) were enacted in 2009 to deal with aggressive tax planning involving the use of sophisticated structures. Originally, the GAAR was part of the Direct Tax Code, but is now part of the Income-tax Act, 1961. Certain GAAR provisions are effective 1 April 2015 (i.e., for Financial Year 2015-16), and India’s Central Board of Direct Taxes in late September 2013 issued rules that relate to application of the GAAR.

    Read a September 2013 report [PDF 293 KB]

  • Reimbursed amounts for salaries of seconded employees not “fees for technical services” under Singapore tax treaty - The Mumbai Bench of the Income-tax Appellate Tribunal held that reimbursed salaries, paid to a Singapore company for seconded employees, are not “fees for technical service” under the Income-tax Act, 1961 or under provisions of the India-Singapore income tax treaty because the Singapore company was not rendering any service to the taxpayer, either directly or indirectly through the seconded employees. The tribunal also concluded that the services provided by the seconded employees were rendered in India, for the taxpayer, and that tax must be withheld (“deducted”). Lastly, the tribunal found no service permanent establishment of the Singapore company in India because the company was not rendering a service to the taxpayer through its seconded employees.

    The case is: Temasek Holdings Advisors (I) P Ltd . Read a September 2013 report [PDF 474 KB]

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