2025 (1) TMI 1415 - SCH - Income Tax

Accrual of income in India - Capital gains tax payable by the Mauritian entity in regard to the sale of shares to the petitioner therein - investments originating from Mauritius - Beneficial ownership of shares - Treaty Benefits under India-Mauritius DTAA - whether sale of shares was not covered by Article 13 (3A) of the DTAA ? - determination of shareholding pattern and the role of key individuals - as decided by HC 2024 (9) TMI 26 - DELHI HIGH COURT the transaction was aimed at tax avoidance is rendered arbitrary and cannot be sustained. The transaction in our considered opinion stands duly grandfathered by virtue of Article 13 (3A) of the DTAA.Writ petitioners of the impugned transaction not being designed for avoidance of tax. The petitioners shall be entitled to all consequential reliefs. HELD THAT - The issues raised in this petition require thorough consideration. In the meantime the impugned judgment order passed by the High Court shall remain stayed from its operation implementation and execution.

Summary

The Supreme Court of India, presided by Justices J.B. Pardiwala and R. Mahadevan, addressed a petition involving significant legal issues that necessitate "thorough consideration." The Court ordered a stay on the operation, implementation, and execution of the impugned judgment and order passed by the High Court. The delay in filing was condoned, and notice was issued with a return date set for February 14, 2025. Advocate Mrs. Taruna Singh Gohil waived the service of notice on behalf of the respondent. The petition features arguments from Mr. N Venkatraman, Additional Solicitor General, representing the revenue, and Mr. Harish Salve, Senior Counsel, representing the respondent-assessee.