| Case ID |
17122d11-8806-4fc8-8e15-0dd0d6e3e3e5 |
| Body |
View case body. Login to View |
| Case Number |
A.A.R. NO. 740 OF 2006 |
| Decision Date |
Nov 16, 2007 |
| Hearing Date |
|
| Decision |
In this case, the Authority for Advance Rulings has ruled that the capital gains on the transfer of shares by the non-resident transferor, Jeff Slosar, to the applicant, Triniti Corporation, is chargeable to tax under the Income Tax Act, 1961, as the capital asset is situated in India. The applicant, Triniti Corporation, is held to be an agent of the non-resident transferor, which allows for the tax to be collected from them as a representative assessee. This decision emphasizes that even if the transaction occurs outside India, as long as the capital asset is located within the country, the income is deemed to accrue in India and thus is subject to Indian tax laws. |
| Summary |
This case revolves around the tax implications of capital gains arising from the transfer of shares of an Indian company by a non-resident. The key issues addressed include the applicability of sections of the Income Tax Act, particularly regarding deemed income arising in India. The Authority concluded that the capital gains tax applies because the shares, a capital asset, are located in India, and thus the income is deemed to accrue in India, irrespective of where the transaction was executed. The ruling clarifies the responsibility of the transferee as an agent for tax purposes, reinforcing the interpretive framework surrounding international tax obligations and capital gains. The decision is significant for non-residents engaging in transactions involving Indian assets, as it highlights the potential tax liabilities they may face in India. Keywords include Capital Gains Tax, Non-Resident Taxation, Income Tax Act, International Taxation, and Advance Rulings. |
| Court |
Authority for Advance Rulings
|
| Entities Involved |
Triniti Corporation,
Jeff Slosar,
Triniti Advanced Software Labs (P.) Ltd.
|
| Judges |
P.V. Reddi, Chairman,
A. Sinha,
Rao Ranvijay Singh, Member
|
| Lawyers |
K.C. Devdas,
Anantha Padmanabhan
|
| Petitioners |
Triniti Corporation
|
| Respondents |
Not available
|
| Citations |
2007 SLD 4056,
(2007) 295 ITR 258,
[2007] 165 TAXMAN 272 (AAR - NEW DELHI)
|
| Other Citations |
G.V.K. Industries Ltd. v. ITO [1997] 228 ITR 564
|
| Laws Involved |
Income Tax Act, 1961
|
| Sections |
9,
45,
161,
163
|