SC to hear tomorrow Castleton Inv case against MAT levy

The Supreme Court would on Wednesday hear an appeal filed by Mauritius-based foreign company, Castleton Investment, against the Income Tax department over levy of minimum alternate tax (MAT). A bench of justices A K Sikri and Rohington Nariman on Tuesday agreed to give an early hearing and said it would tomorrow hear the company's appeal filed against the August 14, 2012 judgement of the Authority of Advance Rulings, which required Castleton to pay MAT in India for transfer of shares from an entity in Mauritius to another in Singapore. The bench also sought the assistance of Attorney General Mukul Rohatgi tomorrow in the matter.

Senior advocate Harish Salve, appearing for the company, sought an early hearing saying the officials representing the firm are in India from overseas for the case. The decision in the case assumes significance with the government announcing its decision to amend the Income Tax Act to exempt foreign portfolio investors (FPIs) and foreign companies from MAT. The Finance Ministry has recently said the decision to exempt foreign companies, which do not have a permanent establishment in India, from payment of MAT will boost investor confidence.