Filing of an income-tax return mandatory for a foreign company even if the income is not taxable in India under the provisions of DTAA

VNU International B. V., AAR No. 871 of 2010, order dated 28 March 2011 Fact :- The applicant is a company incorporated in and tax resident of the Netherlands. The applicant held shares in an Indian private limited company which it sold to two companies tax resident of Switzerland, resulting in capital gains to the applicant company. Issues before the Authority for Advance Rulings (‘AAR’) :- Whether capital gains earned by the applicant on transfer of shares of the Indian company would be liable to tax in India as per the provisions of the Income-tax Act, 1961 („the Act‟) and the Tax T...