CNK in the News: Mint

Delhi High Court says payments to overseas units aren't automatically taxable in India

Our Partner, Pallav Pradyumn Narang, was quoted by Mint in its report on the Delhi High Court's ruling that an Indian payer's location does not, by itself, make a payment to an overseas entity taxable in India.

In the Teva–Ranbaxy dispute, the Court held that the tax department must establish a sufficient nexus between India and the income-producing right or activity, or point to a specific statutory provision. It also rejected the idea that India could tax a receipt merely because another jurisdiction had not taxed it. The judgment may have wider relevance for cross-border settlements, commercial rights, and other arrangements whose underlying activity is outside India.

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