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ArticlesImplementing the Multilateral Instrument in India-The Notification Conundrum [Oct 2025] New
Abstract: In the Sky High Leasing Co. Ltd. v. ACIT [2025] ITA No. 1198/Mum/2025, the Indian Income-tax Appellate Tribunal examined whether, in the absence of a separate protocol or notification amending the concerned double tax avoidance agreement (DTAA), the principal purpose test provision in the MLI can be read to restrict or alter the benefits otherwise available under the DTAA. The ruling followed the India Supreme Court ruling in Nestlé, SA, [Civil Appeal No. 1420 of 2023], which dealt with the Most Favored Nation (MFN) clause in India’s treaties.
This article provides a brief description of the constitutional requirements in India for entering into treaties and granting them the force of law. It then examines the notification requirement under Indian domestic law to implement tax treaties and their revisions, particularly in the context of the MLI signed by India. It examines the Vienna Convention on the Law of Treaties. It concludes that the MLI has already been implemented into domestic law by the 2019 notification, and it requires no further notification.
Treaty Entitlement, Principal Purpose Test, and GAAR-Select Issues [Oct 2025] New
Abstract-The General Anti-Avoidance Rules have been on the statute in India for almost a decade. The court rulings relating to GAAR have started trickling in. The GAAR is no longer just for passive reading; it has entered the boardrooms, where decision-makers in business are actively seeking reassurance that commercial transactions do not fall foul of the general anti-avoidance rules.
It will be some years before the judicial examination of the provisions and their interpretation by the courts becomes available in sufficient quantity and scope as guidance to taxpayers and administrators. In this scenario, a close look at the statutory provisions in Chapter X-A, along with a scan of codified GAAR in other jurisdictions that have rich jurisprudence interpreting these provisions, may provide some insights into how the provisions will eventually be interpreted by the courts in India. This paper deals with some selected issues. It initiates discussion around them with a hope of gauging what the future holds for GAAR.
Economic Substance and the General Anti-Avoidance Rules in India [Oct 2024]
Abstract-Though the general anti-avoidance rules contained in Chapter X-A of the Income-tax Act, 1961 have been in force since 2017, it has taken more than half a decade for the litigation to reach the courts. In the meanwhile, there have been developments elsewhere in the world on combatting tax avoidance. This piece describes the codification of the economic substance in the US and Canadian tax laws and the recent court rulings and attempts to draw out lessons they may hold in the Indian context. Also discussed is whether an absence of a significant non-tax purpose in an arrangement is enough for it to be declared impermissible under the Indian GAAR.
ATO Draft Ruling 2024-D1 on software payments as royalties - An analysis [May 2024]
Abstract- The Australian Tax Office has issued a draft Tax Ruling TR 2024/D1 to provide guidance on payments for computer software, especially on modern forms of software distribution, including digital channels and cloud computing. That this advice on characterising software royalties has been under development for so long gives one a hint of the complex nature of the underlying law and its application to the rapid developments in technology and commerce and the taxability of income earned from computer software. Australia is not alone in this endeavour: several countries have grappled with the issue and have attempted to solve it (unsuccessfully, in the author’s view) by issuing guidance on when payments for computer software would be characterised as royalties under their domestic law and tax treaties. The article discusses some technical issues arising out of the Draft Ruling in interpreting copyright law and their impact on taxation. The discussion could be useful in characterising SaaS subscription payments and other variants in other countries, including India.
Tax Treaties and the MLI -Interpretation and Interplay [April 2023]
Abstract- The Multilateral Instrument which was signed in 2016 to give effect to the BEPS measures in treaties, has begun taking effect. Several of India's treaties in her treaty network are already impacted by the changes brought in by the MLI. The Paper examines the implementation of the MLI in India in the background of the Indian Constitutional provisions that inform the treaty-making rules in the country. Apart from understanding the scope of the MLI, the Paper discusses the impact of the various articles of the Vienna Convention on the Law of Treaties in interpreting the MLI provisions. The Paper describes the compatibility clauses and how they define the modification of CTA provisions. The impact of notifications mismatch on the CTA is explored. The Paper deals with some posers on the subject with an aim to provoke deeper discussion on the MLI and its impact on treaties. Though the Paper describes how and to what extent treaties entered into by India are impacted, the reasoning and conclusion contained in it can surely be of a more general application and to treaties between other countries.
Residence of Individuals under the Income Tax Law in India [December 2023]
Abstract- The status of residence for the purposes of income tax is a primary factor in determining a taxpayer's scope of taxation. This article discusses the various provisions under Indian income tax law that apply to individuals in determining their residence for taxation. It also examines the impact of residence under a double tax avoidance agreement (DTAA) on the residential status under domestic tax law.
New Zealand Supreme Court ruling in Frucor - Lessons for applying Indian GAAR [March 2023]
Tax Treaties - Shields or Swords - A Case Study Analysis [August 2022]
Comments on the ATO Draft Ruling D4-2021 on taxing software payments as royalties [July 2021
Reconstructing the Treaty Network – India Branch Report for International Fiscal Association Congress 2020 Cancun [July 2020]
Comments on UN Discussion Draft on Proposed changes to Article 12 on Royalties [January 2020]
Foreign Jurisprudence on GAAR and their relevance to India [November 2018]
GAAR of Australia, South Africa and the United Kingdom – A comparison with Indian GAAR [October 2017]
Copyright Law and Taxation of Software in India –[(Abstract, Article can be accessed from Asia Pacific Tax Bulletin, IBFD) August 2016]
Equalisation Levy 1.0 -Applicability of Non-discrimination Rules in International Agreements [June 2016]
Software Distribution – Copyright and Income-tax Issues in India [March 2012]
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