22 November 2017, Wednesday

Tax

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Aliff Fazelbhoy

Senior Partner

Tax, Private Equity, M&A, Employment, Banking and Finance

+91 22 40010000
afazelbhoy@almtlegal.com

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Statira Ranina

Partner

Tax, Corporate/Commerical, M&A, Private Equity

+91 22 40010000
sranina@almtlegal.com

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Led by senior partner Aliff Fazelbhoy and partner Statira Ranina, our tax practice provides clients with specialised advice in terms of innovative tax solutions, structuring and execution of transactions and overall tax planning. We are often a part of global tax planning for mergers and acquisitions, assisting clients with their Indian tax requirements.

Our varied experience of Indian direct and indirect tax laws helps us to give comprehensive, legal, practical and solution based advice to clients.

Direct Tax Experience - ALMT Legal’s direct tax practise includes advising on tax efficient jurisdictions for investment into and from India, advising foreign clients on adopting tax efficient structures for their Indian entities, advising on transfer pricing issues, structuring of loans to subsidiaries, structuring employee stock option plans and on a more micro level, personal tax structuring for expatriate executives who are deputed to India. ALMT has also been advising on more topical issues such as taxation of cross-border software payments, withholding and other tax issues arising as a result of Indian call centres and BPOs. We have also assisted clients in defending disputes before various income tax authorities.

Some Sample Transactions

  • Advising the Indian subsidiary of a Hong Kong based leading independent brokerage company in its dispute with the income tax authorities relating to transfer pricing on international transactions entered into by the Indian subsidiary with its associated enterprises in respect of receipt of brokerage commission and payment of brand royalty.
  • Advising a leading multinational in an arbitration proceeding before the London Court of International Arbitration on Indian tax and contract law issues (including withholding obligation) arising in a dispute with an Indian joint venture partner.
  • Advising a leading software multinational in litigating its disputes before the commissioner of income tax-appeals, Dispute Resolution Panel, Income Tax Appellate Tribunal and the High Court regarding transfer pricing on various services provided by the Indian subsidiary to its US parent and vice versa such as R&D, cost sharing, sales and marketing support, market surveys etc. Also advised on representations to be made before the India and US Competent authorities under the MAP provisions of the tax treaty.
  • Advised a Los Angeles based media company on it proposed training arrangement and software license with an Indian media company including permanent establishment, withholding tax issues, personal taxation issues relating to the employees deputed to India and service tax issues arising from such arrangement.
  • Advising one of the leading US based software companies on their strategy for various litigations in India dealing with characterisation of payment of royalty for shrink wrap software including withholding tax issues as well as transfer pricing matters before various forums including an application before the Authority of Advance Rulings and considering applying for an advance pricing agreement.
  • Advising a middle east based entity organising golf tournaments in India on direct tax implications in respect of the golf tournaments organized by the clients in India. Filing an application before the Authority for Advance Rulings (AAR) seeking a determination of the client’s tax liability, if any, arising in India in respect of the golf tournaments organized by the clients in India.
  • Advised one of the world’s largest food and beverages companies on the Indian tax implications of its global restructuring exercise, including on sale of shares of the Indian subsidiary, sale of shares of the holding company of the Indian subsidiary, spin off of one of its group companies etc.
  • Advised a US based network equipment supplier on the most appropriate structure for provision of goods and services in India including on the PE, transfer pricing issues arising from using its Indian subsidiary for provisions of good and services and withholding tax issues on payments by the Indian subsidiary to the US parent.
  • Advised an international serviced residence company with a presence in Europe, Southeast Asia, North Asia and Australia on setting a tax efficient entity in India for carrying on the business of serviced apartments as well as management of such apartments. Also advised on dividend distribution tax, tax incidence on management fees and interest, capital gains tax on a transfer of shares, both under the Income Tax Act and Double Tax Avoidance Agreements.
Indirect Tax Experience - ALMT Legal’s indirect tax practise encompasses all indirect taxes in India including issues relating to service tax, VAT, customs duties and excise. We have advised foreign clients on indirect tax implications relating to goods and services flows into and outside India and on structuring such flows to minimize the incidence of tax. We have also advised on various related issues such as export and import of services including the reverse charge mechanism, availment of input tax credits, appropriate classification of services, taxation of works contracts, exemption from tax for both goods and services, import duties, etc.

Some Sample Transactions

  • Opining on the service tax implications of a complex tripartite agreement including services rendered by a sub contractor to a government company within a special economic zone. The advice included suggesting ways to avoid/mitigate the service tax exposure and dealing with an existing dispute between the contractor and subcontractor on the liability to bear the service tax.
  • Represented one of the world’s largest international airlines on a landmark dispute in respect of the payment of service tax on certain components of the price of a ticket in respect of ‘international premium air travel services’. We have represented the airline before the Commissioner of Service Tax, the Customs Excise and Service Tax Appellate Tribunal and before the Supreme Court of India. While other airlines are in dispute on this same issue at different appellate levels, this is the first case to reach the Supreme Court of India and hence will be the deciding case on this issue.
  • Advised a U.S. based client engaged in the business of selling and leasing intermodal freight containers throughout the world on the service tax / VAT laws implications in India in respect of the contracts entered into by the client with Indian depots for storage, repair and handling services of the containers.
  • Advised, a U.S. headquartered software company, on implications of VAT on import and resale of packaged software and other support services provided in India. We reviewed the existing distribution agreements and analysed the alternative options available in order to claim exemption from levy of VAT.
  • Advised an international online search portal on the indirect tax implications of introducing a new online service in India which would enable customers to make payments to third party merchants including on taxation of payments involved in each stage of the flow of goods as well on incentive payments for use of the service.
  • Advised a multinational hard disk manufacturing company on the duty implications of importing goods into India. Outlined the various models pursuant to which the goods could be imported and stored such as distribution, agency, etc and the customs duty, VAT and service tax implications of each such model.
  • Advised a US based network equipment supplier on the most appropriate structure for provision of maintenance and repair services by its Indian subsidiary to various group entities and third party customers by advising on the indirect tax consequences of structures under consideration by the supplier.
  • Advised a multinational network equipment supplier on mitigating the services tax liability of its wholly owned subsidiary in India by availing of the input tax credit mechanism and by excluding certain expenditures and costs from the value of the service provided by the subsidiary.
  • Advised an international hotel chain on the service tax implications of a management arrangement entered into by it with an Indian company owning hotels in India, including on liability to pay service tax and availment of input tax credit.