Flipkart deal: Tax dept will act once Walmart obtains regulatory nod

Last month, the tax department had written to Walmart saying that the US company can seek guidance about the tax liability under Section 195 (2) of the I-T Act

1522839175-1958

E-commerce major Flipkart has shared 'some details' with the I-T authorities on its USD 16 billion deal with US-based Walmart, but the tax department will act only after regulatory approvals have been obtained, an official said.

The department is currently studying the details received from the company, the official said, adding that they can issue notices seeking details of taxes withheld once the transactions are completed.

Last month, the tax department had written to Bentonville -Arkansas based Walmart saying that the US company can seek guidance about the tax liability under Section 195 (2) of the I-T Act.

Under Section 195 of the Act, anyone making payment to non-residents is required to deduct tax (commonly known as withholding tax).

The official said Flipkart has filed "some details" with the tax authorities and the same are being examined.

"There is no action required right now on our part. We will wait till the regulatory clearances are obtained," the official said.

Nangia Advisors LLP Managing Partner Rakesh Nangia said Income tax department has power to issue notices u/s 133(6) of IT Act to any party involved in this mega deal, including Flipkart, Walmart or any of the investors selling their stake.

"If the department is not satisfied with the reply/ explanation furnished by the purchaser/ payer, it may hold the purchaser/ payer as 'assessee in default' for failure to withhold appropriate taxes u/s 195 of the Act," Nangia said.

The department currently is going through the Section 9 (1) of the Income Tax law, which deals with indirect transfer provisions, to see if the benefits under the bilateral tax treaties with countries like Singapore and Mauritius, could be available for foreign investors selling stakes to Walmart.

Singapore-registered Flipkart Pvt Ltd holds majority stake in Flipkart India.

Walmart had, on May 9, announced that it will pay about USD 16 billion to buy about 77 per cent stake in Flipkart.

Read More On : Flipkart deal

Comments

Post a Comment

Popular posts from this blog

CBSE 10th result 2018 to be out tomorrow at 4pm on cbse.nic.in; updates

Image
CBSE 10th result 2018 will be declared on May 29, Central Board of Secondary Education confirmed. Check for CBSE Results updates on Business Standard CBSE 10th Result 2018 will be declared on Tuesday at 4pm.  The Central Board of Secondary Education  (CBSE) today announced that CBSE Class 10 result 2018 will be declared tomorrow. Over 16 lakh students appeared for Class 10 exams this year. CBSE will release CBSE 10th result 2018 on its official website  http://cbse.nic.in  or  http://cbseresults.nic.in . "Results of CBSE Class 10 examinations for 2017-18 to be declared by 4 pm on 29th of May, 2018," tweeted Union Education Secretary Anil Swarup. The  CBSE Class 10  exams were marred by controversy in 2018 with question paper leaks being reported from Delhi-NCR, Haryana and Jharkhand of Class 10 mathematics paper, but the HRD ministry had decided against conducting a re-examination in the "interest of students". This was the first batc...
Read more

Xiaomi Redmi S2 leak shows Redmi Note 5 Pro-inspired design: Details here

Image
The India-bound budget-centric smartphone is reported to sport dual rear cameras and feature face-unlock mechanism. Here are all the details you need to have for the upcoming Xiaomi smartphone Chinese smartphone manufacturer Xiaomi is closely working on a new Redmi device that is also expected to make its way to India. Touted as the  Redmi S2 , the budget-centric smartphone is reported to sport dual rear cameras and feature the face-unlock mechanism, according to a report by online technology-based forum XDA-developers. Now, the phone's purported image renders, shared by a Czech-based online publication SvetAndroida, show Redmi S2's front and back views. Based on renders, the phone would sport a tall 18:9 aspect ratio screen on the front and dual cameras on the back, along with a fingerprint scanner. The phone’s back seems identical to the Redmi Note 5 Pro, which was launched in India on February 14. However, the dual antenna lines on top and bottom have a differe...
Read more

Restructuring: Tata Motors rolls out VRS, moves to a flat five-level hierarchy

Image
So far, less than 500 executives have been offered VRS, which roughly includes one year's salary Tata Motors, India’s largest automobile maker, has started rolling out a voluntary retirement scheme (VRS) for its employees as part of its organisational restructuring exercise. This is part of a human resources (HR) restructuring drive that is expected to transform the organisation into a much leaner company with a flat hierarchical structure. The new structure will be in place from April 1. So far, less than 500 executives have been offered VRS, which roughly includes one year’s salary, among other benefits, sources said. The company, however, did not confirm the details of the VRS package or how many were offered VRS. A company spokesperson said: “ Tata Motors  confirms that as part of the ongoing organisation effectiveness project, where we have already finalised the top two levels of our management structure, a proposal on VRS package has been presented and approved by...
Read more