Take the pledge to vote

For a better tommorow#AajSawaroApnaKal
  • I agree to receive emails from News18

  • I promise to vote in this year's elections no matter what the odds are.
  • Please check above checkbox.

    SUBMIT

Thank you for
taking the pledge

Vote responsibly as each vote counts
and makes a diffrence

Disclaimer:

Issued in public interest by HDFC Life. HDFC Life Insurance Company Limited (Formerly HDFC Standard Life Insurance Company Limited) (“HDFC Life”). CIN: L65110MH2000PLC128245, IRDAI Reg. No. 101 . The name/letters "HDFC" in the name/logo of the company belongs to Housing Development Finance Corporation Limited ("HDFC Limited") and is used by HDFC Life under an agreement entered into with HDFC Limited. ARN EU/04/19/13618
CO-PRESENTED BY
LIVE TV DownloadNews18 App
News18 English
272
nda:
Needmore seats to Win
Needmore seats to Win
upa:
»
2-min read

Walmart Likely to Approach I-T Department to Determine Tax Liability in Flipkart Deal

Under Section 197, any NRI selling shares can give reasons to Indian authorities as to why they should be taxed at a lower or nil rate in India.

PTI

Updated:August 9, 2018, 9:14 PM IST
facebookTwittergoogleskypewhatsapp
Walmart Likely to Approach I-T Department to Determine Tax Liability in Flipkart Deal
In case of Walmart-Flipkart deal, the withholding tax pertains to the capital gains made by the shareholders of Flipkart. (Network18 creative)
Loading...
New Delhi: US-retail major Walmart may approach Indian authorities seeking withholding tax certificates for determining the tax liability in the USD 16 billion Flipkart buyout deal.

Following CCI's nod to the Walmart-Flipkart deal, the I-T department expects Walmart to approach it under Section 197 of the Income Tax Act within a fortnight.

"We were told that the deal would be closed within a week of the Competition Commission of India (CCI ) approval. So we expect them to file with the I-T authorities seeking withholding tax certificate under Section 197 within a fortnight," an I-T official said.

Under Section 197, any NRI selling shares can give reasons to Indian authorities as to why they should be taxed at a lower or nil rate in India.

Walmart last month assured the I-T department that it will fulfil all tax obligations.

"We take seriously our legal obligations, including the payment of taxes to governments where we operate. We will continue to work with Indian tax authorities to respond to their inquiries," Walmart said in a statement.

Bengaluru-based e-commerce major Flipkart had in May shared share purchase agreement with tax authorities, and I-T department is currently calculating the tax rate that would be applicable for investors in Flipkart who are selling the shares to Walmart.

The I-T department is going through the share purchase agreement, reading in depth which investor has routed money from which jurisdiction and when and whether any treaty benefit apply to them, the official added.

Nangia Advisors LLP Managing Partner Rakesh Nangia said lower or nil withholding tax order obtained under Section 197 before making payment to Flipkart shall act as a provisional assessment of the transaction.

The payee can represent the case before tax authorities to determine the withholding tax implication on the transaction and the payer has to consider the lower/nil withholding tax order at the time of making payment to Flipkart, Nangia said.

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

Significant shareholders in Flipkart, like SoftBank, Naspers, venture fund Accel Partners and eBay, have agreed to sell their shares. Also co-founder Sachin Bansal would be selling his stake to the US retail major.

The department has been reviewing Section 9 (1) of the I-T Act, 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.

In May, the I-T 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.

Under Section 195 of the Act, anyone making payment to non-residents is required to deduct tax (commonly known as withholding tax).
(Get detailed and live results of each and every seat in the Lok Sabha elections and state Assembly elections in Andhra Pradesh, Odisha, Arunachal Pradesh and Sikkim to know which candidate/party is leading or trailing and to know who has won and who has lost and by what margin. Our one-of-its-kind Election Analytics Centre lets you don a psephologist’s hat and turn into an election expert. Know interesting facts and trivia about the elections and see our informative graphics. Elections = News18)
Read full article
Loading...
Next Story
Next Story

Also Watch

facebookTwittergoogleskypewhatsapp
 
 
Most Active
Company Price Change %Gain
ICICI Bank 431.75 5.09
Reliance 1,336.85 0.22
SBI 355.35 3.84
IndusInd Bank 1,648.90 3.14
Larsen 1,544.15 4.61
Company Price Change %Gain
GRUH Finance 313.30 -4.42
Reliance 1,336.80 0.07
Larsen 1,543.65 4.60
SpiceJet 141.55 9.64
SBI 354.60 3.59
Top Gainers
Company Price Change %Gain
ICICI Bank 431.75 5.09
Larsen 1,544.15 4.61
Zee Entertain 376.85 4.55
JSW Steel 288.00 4.37
Bharti Airtel 353.20 4.25
Company Price Change %Gain
ICICI Bank 431.50 5.09
Larsen 1,543.65 4.60
Bharti Airtel 353.30 4.40
Vedanta 163.85 4.20
Tata Motors 182.15 4.09
Top Losers
Company Price Change %Gain
Tech Mahindra 735.85 -1.00
NTPC 129.15 -0.54
TCS 2,048.00 -0.29
HUL 1,749.60 -0.24
HCL Tech 1,065.95 -0.04
Company Price Change %Gain
NTPC 129.20 -0.54
HCL Tech 1,061.65 -0.46
TCS 2,049.65 -0.20
HUL 1,749.20 -0.10

Live TV

Loading...
Countdown To Elections Results
  • 01 d
  • 12 h
  • 38 m
  • 09 s
To Assembly Elections 2018 Results