India and Mauritius have signed a protocol to amend the double taxation avoidance agreement, which included a principal purpose test to decide whether a foreign investor is eligible to claim treaty benefits
The amended India-Mauritius tax treaty has inserted a new clause allowing source-based taxation at 10 percent on fees paid for technical and consultancy services.
In 2011, Blackstone Mauritius sold 66.29 percent and Barclays Mauritius sold 12.75 percent of equity in SKR BPO to Serco. SKR-owned 100 percent of BPO service provider Intellenet and 20 percent of another BPO Sparsh.
Holcim stands to gain Rs 3,500 crore free of tax from India because Holcim Mauritius is going to be the seller of shares and as per the India-Mauritius tax treaty there is no tax on capital gains
This alert by Khaitan & Co. covers the latest Advance Ruling delivered by the Authority for Advance Rulings.