Authority For Advance Rulings (Income Tax) And Others Vs Tiger Global International II Holdings (Supreme Court of India)
Taxability of gains earned by Tiger Global on its sale of Flipkart holdings was before the Honourable SC. Ruling is reserved for 9 months/ Pronounced today on 15-01-2026 which Goes in favour of the Revenue:
Key issue:
Under the India-Mauritius tax treaty, capital gains earned by Mauritius residents from selling shares of Indian companies are generally not taxable in India.
For many years, this position was clear. Even the landmark Circular 789 stated that if an investor was a tax resident of Mauritius and held a valid Tax Residency Certificate (TRC), treaty benefits would apply – even if the investment structure existed mainly to access the treaty.
The real dispute in this case was straightforward: Is it enough to route an investment through Mauritius only to claim treaty benefits, or must there be real business substance in Mauritius?
Historically, the tax department has argued that form alone is not sufficient. According to Revenue, there must be genuine commercial substance – some real activity, presence, or decision-making in Mauritius to justify treaty protection. What qualifies as “enough substance” has always depended on the facts of each case.
