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TMI BlogInsertion of new Chapter X-A.X X X X Extracts X X X X X X X X Extracts X X X X ..... may be applied to any step in, or a part of, the arrangement as they are applicable to the arrangement. 96. Impermissible avoidance arrangement. ( 1) An impermissible avoidance arrangement means an arrangement, the main purpose or one of the main purposes of which is to obtain a tax benefit and it ( a ) creates rights, or obligations, which are not ordinarily created bet-ween persons dealing at arm's length; ( b ) results, directly or indirectly, in the misuse, or abuse, of the provisions of this Act; ( c ) lacks commercial substance or is deemed to lack commercial substance under section 97, in whole or in part; or ( d ) is entered into, or carried out, by means, or in a manner, which are not ordinarily employed for bona fide purposes. (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... benefit (but for the provisions of this Chapter), without having any regard to ( A ) whether or not the funds involved in the round trip financing can be traced to any funds transferred to, or received by, any party in connection with the arrangement; ( B ) the time, or sequence, in which the funds involved in the round trip financing are transferred or received; or ( C ) the means by, or manner in, or mode through, which funds involved in the round trip financing are transferred or received. (3) For the purposes of this Chapter, a party to an arrangement shall be an accommodating party, if the main purpose of the direct or indirect participation of that party in the arrangement, in whole or in part, is to obtain, directly or indirectly, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of determining tax treatment of any amount; ( e ) reallocating amongst the parties to the arrangement ( i ) any accrual, or receipt, of a capital or revenue nature; or ( ii ) any expenditure, deduction, relief or rebate; ( f ) treating ( i ) the place of residence of any party to the arrangement; or ( ii ) the situs of an asset or of a transaction, at a place other than the place of residence, location of the asset or location of the transaction as provided under the arrangement; or ( g ) considering or looking through any arrangement by disregarding any corporate structure. (2) For the purposes of sub-section (1) , ( i ) any equity may be treated as debt or vice versa; ( ii ) any accrual, or receipt, of a capital nature may be treated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or any relative of such director, if the person is a company; ( c ) any partner or member of a firm or association of persons or body of individuals or any relative of such partner or member if the person is a firm or association of persons or body of individuals; ( d ) any member of the Hindu undivided family or any relative of such member, if the person is a Hindu undivided family; ( e ) any individual who has a substantial interest in the business of the person or any relative of such individual; ( f ) a company, firm or an association of persons or a body of individuals, whether incorporated or not, or a Hindu undivided family having a substantial interest in the business of the person or any director, partner, or member of the company ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g assigned to it in the Explanation to clause ( vi ) of sub-section (2) of section 56; ( 9 ) a person shall be deemed to have a substantial interest in the business, if ( a ) in a case where the business is carried on by a company, such person is, at any time during the financial year, the beneficial owner of equity shares carrying twenty per cent or more, of the voting power; or ( b ) in any other case, such person is, at any time during the financial year, beneficially entitled to twenty per cent or more, of the profits of such business; ( 10 ) "step" includes a measure or an action, particularly one of a series taken in order to deal with or achieve a particular thing or object in the arrangement; ( 11 ) "tax benefit" means ( a ) a reduc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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