Tax Law and International Tax Law

The article discusses the key changes introduced in the recent amendment to Section 9D of the Mines and Minerals (Development and Regulation) Act. which provides certainty, price parity, and uniform taxation across the country. It also discusses the background of the said amendment, which necessitated this amendment.

In Aerocom Cushions Private Limited v. Assistant Commissioner (Anti-Evasion), CGST & CX, Nagpur-1, the Nagpur Bench of the Bombay High Court quashed a Show Cause Notice demanding Goods and Services Tax (“GST”) on the assignment of leasehold rights in an industrial plot allotted by the Maharashtra Industrial Development Corporation (“MIDC”). The Court held that such an assignment constitutes a transfer of benefits arising out of immovable property and does not amount to a “supply of service” under the Central Goods and Services Tax Act, 2017 (“CGST Act”).

The May 2026 edition of Fox & Mandal's Dispute Resolution & ADR Newsletter analyses lifting the corporate veil during insolvency; functional dependence in the delineation of relevant market under competition law; post-award interim relief by an unsuccessful party; GST on damages in arbitral award; and other recent judgments of the Supreme Court of India and various High Courts.

For an overseas business entering India, the first legal decision is not what to sell but how to be present. A liaison office, a branch, a project office and an Indian subsidiary each decide what the business may do in India, which regulators it answers to and how it is taxed.

An engineering, procurement and construction contract in India is taxed on the strength of decisions taken before the award: how the scope is divided, which entity signs, where title to equipment passes, and what the employer is told to withhold.

An Indian company pays a foreign supplier, parent or consultant, and deducts nothing. The invoice is settled, the money has left India, and a notice arrives two years later. From 1 April 2026 this sits in the Income-tax Act, 2025, where the withholding obligation on payments to non-residents is in Section 393(2) and the consequences of failure are in Section 398. The liability falls first on the Indian payer, but the recipient is rarely left untouched, because the payer usually looks to the contract to recover what it has paid. This note takes both sides in turn. The firm sets out the framework on its page on withholding tax on payments to non-residents.

Many multinational groups now run a good part of their research and development from a global capability centre (GCC) in India. The engineering work gets done, the product gets built, and then a simple question comes up that nobody had planned for: who actually owns the intellectual property (IP)? In my experience advising on such structures, this question is usually asked late, often during a funding round, an audit or a dispute. By then, fixing the paper trail is expensive.

Aurtus provides comprehensive tax and advisory services spanning direct tax, indirect tax, and international tax matters. Their expertise includes transaction structuring, M&A assistance, IPO advisory, GST compliance, transfer pricing, and specialized services for family offices and GIFT IFSC setups. The firm offers end-to-end solutions for corporate tax planning, dispute resolution, and regulatory compliance across domestic and cross-border transactions.

The Delhi Tribunal's recent ruling in Paul Wurth Italia has reshaped the application of the force of attraction rule under tax treaties, emphasizing that a permanent establishment's mere existence cannot justify taxation of all source-country profits. This decision marks a critical shift toward requiring demonstrable factual and functional nexus between the PE and disputed income, signaling a more restrained interpretation of this contested principle in international taxation.

On 13 October 2026, the Government of India notified the protocol amending the India-Mauritius tax treaty (Protocol) which was signed on 7 March 2024 (Notification)1. As per the Notification, the Protocol entered into force on 10 August 2026, pursuant to which all transactions undertaken on or after 10 August 2026 will be subject to the Principal Purpose Test (PPT).

In December 2020, an arbitral tribunal ordered India to pay Cairn Energy about USD 1.2 billion, plus interest and costs, for a tax demand raised under a retrospective amendment. Three months earlier, Vodafone had won a similar case. Both claims succeeded because the investment treaties under which they were brought did not exclude tax. Under the treaties India signs today, neither claim could have been brought at all.

The Delhi Tribunal's recent ruling in Paul Wurth Italia has reshaped the application of the force of attraction rule under tax treaties, emphasizing that a permanent establishment's mere existence cannot justify taxation of all source-country profits. This decision marks a critical shift toward requiring demonstrable factual and functional nexus between the PE and disputed income, signaling a more restrained interpretation of this contested principle in international taxation.