India-Mauritius DTAA, Justice Yashwant Varma, Meta’s Appeal & More

“The whole media has painted him black. If he’s ultimately acquitted, nobody is going to believe that he was an honest judge. His career is over, whatever may happen to the case.”

— Senior Advocate Mukul Rohatgi on Justice Yashwant Varma and perils of media trial

A Resounding End for the Popular ‘Mauritius Route’

The Supreme Court’s ruling which held New York based Tiger Capital liable to pay capital gains taxes on its 2018 deal selling its stake in Flipkart to Walmart has potentially sent a strong current down the private equity sector even as the government counsel has rebutted the interpretation that the judgment is anti-investment in India.

The top court set aside a Delhi High Court verdict which found no wrong-doing by Tiger Global in seeking tax exemption under the double taxation avoidance agreement treaty between India and Mauritius. The Supreme Court said that tax planning has to be differentiated from tax evasion and said that Tiger Global’s Mauritius route was impermissible. Following the court’s pronouncement, the government counsel, in lighter vein, said to the court that this judgment was a win for Bharat Mata.

But this precedence begs the question if it will see a wider impact in investment in India. It’s clear as day that investment firms which operate through tax havens such as Mauritius for their investment into India may have to recalibrate their operations so as to not find themselves on the wrong side of the Indian law. 

Key Rulings:

• Hindustan Times is not liable to pay service tax on bookings of foreign speakers invited to speak at summits, the Supreme Court holds

• Supreme Court holds that homebuyers’ societies, RWAs cannot intervene in insolvency proceedings against a developer

• Tiger Global, a US based investment firm, is liable to pay capital gains taxes in India on the sale of shares in Flipkart owned by the firm’s Mauritius-based arm, the Supreme Court holds; says the Mauritius route in this case is impermissible to claim tax exemption under the double taxation avoidance agreement 

Courts: 

• Delhi High Court grants protection to news channel Aaj Tak’s logo against trademark infringement

• Late industrialist Sunjay Kapur’s wife Priya sues sister-in-law in Delhi court for criminal defamation

• Supreme Court seeks response from the Centre on a plea for setting up of an Arbitration Council of India

• Supreme Court rejects Justice Yashwant Varma’s plea against impeachment proceedings against him in relation to corruption charges 

• Meta moves Supreme Court against NCLAT ruling that upheld CCI penalty on the company over its WhatsApp privacy policy

• Banks and auditor move Bombay High Court seeking to revoke the stay on probe against Anil Ambani in fraud tag case

Quasi Courts:

• SAT quashed SEBI order holding Bombay Dyeing guilty of fraud scheme

The Big Listings:

• Jan 21: Supreme Court to hear Delhi NCR air pollution matter

• Jan 21: Supreme Court to hear suo moto case on Aravalli ranges redefinition

• Jan 22: Delhi High Court to hear issue relating to Indigo disruption and mass cancellation of flights

• Jan 27: Delhi High Court to hear Apple Inc.’s plea against India’s competition law’s provisions on global turnover-based penalties on MNC

• Feb 4: Allahabad NCLT to hear Jaiprakash Associates’ Insolvency case for approval of successful bid

• Feb 25: Securities Appellate Tribunal to hear appeal by Jane Street challenging SEBI’s move to allegedly refuse access to important documents to the firm in the case against it

• Apr 8: Delhi High Court to hear Indigo’s petition seeking 9 billion rupees in refund from customs over re-imports

* The dates of hearing can change and a concrete list is prepared just a day before

Legal Moves: 

• Government notifies appointment of Justice Sujoy Paul as chief justice of Calcutta High Court shortly after recommendation by collegium

• Vivek Daswaney joins Economic Law Practice along with a team of six professionals

• Rima Bhardwaj joins AB InBev as Director

• Srijit Mukherjee joins Kocho as General Counsel 

• Nishtha Kumar joins Saga Legal as Partner

• Pooja Singhania leaves SAM to join KKR as counsel

• Ankita Singh Malhotra joins Infinia Technologies as CLO