D.B. ZWIRN MAURITIUS TRADING NO. 2 LIMITED Vs. DIRECTOR OF INCOME TAX

JUDGEMENT

(1.) THE applicant, D.B. Zwirn Mauritius Trading No. 2 Ltd. is a company incorporated in Mauritius and was issued a Tax Residence Certificate by the Mauritius Tax Authorities. It is engaged in the business of investments in different sectors. The applicant held 61,33,333 equity shares of Quippo Telecom Infrastructure Limited, an Indian company. These were acquired on 19th September, 2007, for a consideration of Rs. 24,53,33,320. On 10th November, 2009, the applicant entered into a share purchase agreement to sell these 61,33,333 shares to Geraldton Finance Limited, a Mauritius based company, for a consideration of Rs. 64,39.99,965. The applicant realized capital gain of Rs. 34,70,48,800.

(2.) THE Applicant has approached this Authority to determine whether by virtue of being a Mauritius resident, it is eligible to the benefits of the India -Mauritius DTAA and hence not subject to tax in India on the capital gains realized. It has sought the ruling of this Authority on the following questions:

(3.) WHETHER , in respect of the transaction of sale of shares explained in statement of facts, there is any withholding tax liability under Section 195 of the Income -tax Act, 1961.