August 2007

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Tax professionals of the member firms of Deloitte Touche Tohmatsu, in co-operation with the
Economist Intelligence Unit, a leading provider of country, industry and management analysis, have
created the Deloitte International Tax and Business Guides, an online and print series designed to
provide insights on tax and business issues in various jurisdictions worldwide. Based on research by
the Economist Intelligence Unit and Deloitte, and updated on a regular basis, the Guides contain
information on investment conditions, tax regimes and regulatory requirements, along with
information for executives working abroad. The Guides are supplemented by the Snapshot series,
an at-a-glance summary of basic information, including tax rates, for nearly 100 jurisdictions.
India
International Tax and
Business Guide

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1.0 The investment climate....................................................................................... 1
1.1 Economic structure ..................................................................................................... 1

1.2 Banking and financing ............................................................................................... 2

1.3 Foreign trade .............................................................................................................. 2

2.0 Business regulations ........................................................................................... 2

2.1 Registration and licensing.......................................................................................... 2

2.2 Price controls............................................................................................................... 3

2.3 Monopolies and restraint of trade............................................................................ 3

2.4 Intellectual property................................................................................................... 3

2.5 Mergers and acquisitions ........................................................................................... 4

3.0 Foreign investment ............................................................................................. 4

3.1 Foreign investment incentives and restrictions........................................................ 4

3.2 Exchange controls....................................................................................................... 5

4.0 Choice of business entity.................................................................................... 5

4.1 Principal forms of doing business.............................................................................. 5

4.2 Establishing a branch ................................................................................................. 7

4.3 Setting up a company ................................................................................................ 8

5.0 Business taxation................................................................................................. 8

5.1 Overview ..................................................................................................................... 8

5.2 Taxable income and rates .......................................................................................... 8

5.3 Capital gains taxation .............................................................................................. 11

5.4 Foreign income and tax treaties.............................................................................. 11

5.5 Transactions between related parties..................................................................... 13

5.6 Turnover and other indirect taxes and duties........................................................ 14

5.7 Other taxes................................................................................................................ 15

5.8 Tax compliance and administration ........................................................................ 15

India
International Tax and 6.0 Personal taxation............................................................................................... 16
Business Guide
6.1 Residency................................................................................................................... 16

6.2 Taxable income and rates ........................................................................................ 16

6.3 Special expatriate tax regime .................................................................................. 17

6.4 Capital taxes.............................................................................................................. 17

7.0 Labour relations and workforce....................................................................... 18

7.1 Visa and entry requirements.................................................................................... 18

7.2 The employment market.......................................................................................... 18

7.3 Employees’ rights and remuneration...................................................................... 19

7.4 Wages and benefits.................................................................................................. 20

7.5 Termination of employment.................................................................................... 20

7.6 Labour-management relations ................................................................................ 20

7.7 Employment of foreigners ....................................................................................... 21

8.0 General information.......................................................................................... 21

9.0 Office locations.................................................................................................. 22

India
International Tax and
Business Guide

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1.0 The investment climate
This report was last updated in August 2007.

Political background
India is a federal republic, with 28 states and seven federally administered union territories, and it operates a multi-party
parliamentary democracy system.
India is the second most populous country in the world and the seventh largest in the world in terms of area.
New Delhi in northern India is the capital and the seat of India’s parliament. Parliament has two houses: the Lok Sabha
(the lower house), which comprises representatives elected directly by the citizens of India through elections held every
five years or earlier; and the Rajya Sabha (the upper house), whose representatives are elected by the members of the
respective state assemblies.
The president is the constitutional head of the country and of the armed forces. The president acts and discharges the
constitutional duties on the advice of the Council of Ministers, which is headed by the prime minister. The prime
minister and the Council of Ministers in turn are responsible to parliament and subject to the control of the majority
members of parliament.
The United Progressive Alliance, a multi-party coalition led by the Indian National Congress, is in government and is
headed by the prime minister, Dr Manmohan Singh.

1.1 Economic structure

The Indian economy has witnessed an economic boom, underlined by strong macroeconomic fundamentals, with real
GDP growth recording annual average rates of just over 9% in the last two fiscal years, ending March 2007. Growth is
expected to continue, if not exceed, this rate in fiscal year 2007/08. A notable feature of the boom has been the sharp
rise in the rate of investment in the four consecutive years since 2002/03.
India is a three-tier economy, comprising a globally competitive services sector, a manufacturing sector and an
agricultural sector. The services sector has proved to be the most dynamic in recent years, with trade, hotels, transport,
telecommunications and information technology, financial, real estate and business services registering particularly
rapid growth.
Although the economy’s dependence on agriculture has declined in recent years, fluctuations in the contribution of
agriculture to overall GDP growth are largely a result of the outcome of the annual monsoon.
Manufacturing has seen unprecedented growth of over 7% per annum for more than three consecutive years
since 2004/05.

Comparative economic indicators, 2006

India China Pakistan Bangladesh Sri Lanka

GDP (US$ bn) 922.9 2,765.5 126.8 62.0 27.0
GDP per head (US$) 843 2,100 787 429 1,290
Consumer price inflation (av; %) 6.2 1.7 7.9 6.8 13.7
Current-account balance (US$ bn) -10.4 246.9 -6.1 6.0 -1.0
Exports of goods fob (US$ bn) 123.2 969.7 17.0 11.2 7.2
Imports of goods fob (US$ bn) 184.4 751.9 26.7 14.8 9.4
Source: Economist Intelligence Unit estimates, August 2007.

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India
International Tax and 1.2 Banking and financing
Business Guide
India’s financial and commercial centre is Mumbai, and there are proposals to develop this area further as an
International Financial Centre. The Reserve Bank of India (RBI, the central bank) has responsibility among others for
banking sector development and regulations, currency and credit flow management, foreign-exchange management
and ensuring monetary stability. It also acts as a banker to the government.

The banking sector in India is broadly represented by:

• Public-sector banks—where the government owns a majority shareholding and includes the State Bank of India and
its subsidiary after transfer of the shares by the RBI to the Indian government;

• Private-sector banks—whose majority ownership is in the hands of private institutions;

• Foreign banks—operating in India through their branches/wholly owned subsidiaries; and
• Co-operative banks—which are regional in most cases but can be large.

The RBI has announced a “road map” for the presence of foreign banks in India, which allows foreign banks
unprecedented room to operate. A more competitive banking sector environment is expected in 2009, when the second
phase of the road map will allow foreign banks to compete more freely.

The RBI is responsible for regulating non-banking financial services companies (NBFCs), which operate like banks but are
otherwise not permitted to carry on the business of banking. Since December 2006 stringent rules govern the
operations of important NBFCs, such as those with assets of INR 1bn or more, in order to reduce the scope of regulatory
arbitrage vis-à-vis a bank.

Capital markets
The Securities and Exchange Board of India (SEBI) is the independent, statutory regulatory authority with responsibility
for regulating and developing the capital market. The Bombay Stock Exchange and the National Stock Exchange of India
are the two largest stock exchanges.
The government has liberalised the guidelines for listing by foreign companies on Indian stock exchanges. Indian
companies already listed on Indian stock markets may be listed on foreign stock exchanges if certain conditions
are satisfied.
Other players active in investing and financing in companies include among others private equity investors, foreign
institutional investors and mutual funds (both Indian and foreign).

1.3 Foreign trade

During fiscal year 2006/07 (ending March 2007), export earnings reached US$124.6bn, a 23.9% increase year on year.
Export performance was dominated by volume growth until 2002/03, which was replaced by higher unit value exports
in 2003/04. Since 2004/05, exports have been growing in terms of volume and unit value. Although India’s major goods
exports have long been textiles and gems re-exported after cutting, the country has recently seen significant exports of
chemicals and automotive components.
During 2006/07, imports grew by 26.4% year on year to US$181.4bn. India’s largest imports are petroleum and related
products. Recently, with import liberalisation, electronic goods, capital goods in construction, engineering products and
gold imports have also registered growth.

India maintains complex procedures and documentation requirements for both imports and exports (these are listed in a
handbook of trade procedures published by the Ministry of Commerce and Industry).

2.0 Business regulations

2.1 Registration and licensing

Foreign investment is freely permitted in almost all sectors. Foreign direct investment is made through two routes:
automatic and government-approved. Under the automatic route, the foreign investors or the Indian company do not
need the approval of the Indian government or the Reserve Bank of India (RBI, the central bank). Documents need only
be submitted ex-post facto to the RBI. Where there are sector-specific caps, proposals for stakes up to those caps are
automatically approved, with a few exceptions.
Proposals that do not qualify for automatic approval must be submitted to the Foreign Investment Promotion Board
(FIPB), which is the usual contact for large multinationals with extensive investment plans. The FIPB may negotiate
project terms with investors. Downstream ventures—such as wholly owned subsidiaries of foreign companies—may be

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India
International Tax and established without prior FIPB approval, but this applies only to sectors where automatic clearance is already granted for
Business Guide foreign direct investment.

The Secretariat for Industrial Assistance (SIA), which operates within the Ministry of Commerce and Industry, issues
industrial licences, provides information and assistance to companies and investments, monitors delays, and reports all
government policy relating to foreign investment and technology. Investors may file a package application covering both
the licence and the foreign investment with the SIA or the FIPB. The normal processing time is up to three months.
The government’s industrial policy adopted in 1991 provides, inter alia, for the RBI to give automatic approval to
foreign-technology agreements in which lump-sum payments and royalties fall within approved limits. Applicants must
file their agreements with the appropriate regional offices of the RBI. The approval process is straightforward and can
take less than a week. For proposals that do not fall within the specified payment parameters, it is necessary to apply to
the SIA for approval. Such proposals may take four to six weeks. No special controls apply to agreements between a
foreign parent and a local subsidiary.
Royalty payments on trademarks and brand names are permitted up to 1% on domestic sales and 2% on exports on the
use of marks of a foreign collaborator without a technology transfer, under the automatic route.

Renewals of licensing agreements require specific approval, but they are generally possible, especially if the
licenser makes new technology or processes available or permits the licensee to export to areas not covered by the
original contract.

2.2 Price controls

The central and state governments have passed legislation to control production, supply, distribution, and the price of
a number of commodities.
The central government is empowered to list any class of commodity as an essential commodity. The central government
can regulate or prohibit the production, supply, distribution, price and trade in any of these commodities for the
following purposes:
• Maintaining or increasing their supply;
• Equitable distribution and availability at fair prices of the commodities concerned; and
• Securing an essential commodity for the defence of India or the efficient conduct of military operations.

2.3 Monopolies and restraint of trade

India’s markets are monopolised in only a few areas reserved for the public sector, such as postal services, defence,
atomic energy and railways. The government is considering gradual private participation in areas reserved for exclusive
state ownership. The emphasis is to develop viable projects on public-private participation mode.
Most other public-sector monopolies have vanished as the government has permitted greater private participation.
Monopolies are rare in activities open to the private sector.
The Monopolies and Restrictive Trade Practices Act 1969 prohibits restrictive trade practices and unfair trade practices.
The Competition Act 2002 prohibits anti-competitive agreements, including the formation of cartels and sharing of
territories, restriction of production and supply, collusive bidding and bid rigging, and predatory pricing. The following
practices are considered objectionable if they lead to a restriction of competition: tie-in arrangements that require the
purchase of some goods as a condition of another purchase; exclusive supply or distribution agreements; refusal to deal
with certain persons or classes of persons; and resale price maintenance.
There are also rules prohibiting abuse of a dominant position and regulations for certain business combinations. The
Competition Commission was established in 2003 to prevent such practices from having an adverse effect on
competition, promote and sustain competition in markets, protect the interests of consumers and ensure freedom of
trade carried on by other participants in markets in India.

2.4 Intellectual property

Indian legislation covers patents, copyrights, trademarks, geographical indicators and industrial designs.

India’s Patent Act 1970 has been amended several times to meet India’s commitments under its obligations to the World
Trade Organisation (WTO), such as increasing the term of a patent to 20 years.
Trademarks can be registered under the Trade Marks Act, 1999, which came into force in 2003 and replaced the
previous law of 1958. The act broadens the definition of trademark, provides for registration of trademark for services in
addition to goods, simplifies procedures, increases the registration period to ten years and provides a six-month grace
period for the payment of renewal fees.

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India
International Tax and Copyright is protected on published and unpublished literary, dramatic, musical, artistic and film works under the
Business Guide Copyright Act 1957. Subsequent amendments have extended copyright protection to other products such as computer
software and improved protection of literary and artistic work and established better enforcement. The Copyright
(Amendment) Act 1999 increases the protection term for copyrights and rights of performers and producers of
phonograms to 50 years.

India is a signatory to the Paris Convention for the Protection of Industrial Property and the Patent Co-operation Treaty,
and it extends reciprocal property arrangements to all countries party to the convention. The convention makes India
eligible for the Trademark Law Treaty and the Madrid Agreement on Trademarks. The country also participates in the
Bern Convention on Copyrights, the Washington Treaty on Layout of Integrated Circuits, the Budapest Treaty on Deposit
of Micro-organisms and the Lisbon Treaty on Geographical Indicators.

2.5 Mergers and acquisitions

The acquisition of a business can be accomplished in various ways, including among others the acquisition of shares of
a target company, acquisition of assets with or without liabilities and workforce, acquisition of business as a going
concern and acquiring control.
Mergers and acquisitions are generally governed by the Companies Act, 1956 and the sector-specific law, such as
telecoms, insurance, pension and banking. In the case of listed companies, provisions of Listing Agreements with the
stock exchange SEBI (Disclosure & Investor Protection Guidelines), 2000, SEBI (Substantial Acquisition of Shares and
Takeovers) Regulations, 1997 must be complied with. If a merger has cross-border aspects, the parties must comply with
among others the foreign direct investment policy of the government, the Foreign Exchange Management Act, 1999.
Broadly, the transfer of business/assets requires the approval of the shareholders of a company. This can be done with
the additional procedure of court approval or can be a simple shareholders’ approval without court approval, depending
on the manner of the transfer.
A reorganisation involving the amalgamation of companies or a tax neutral de-merger would require formal court
approval, as well as the approval of creditors, the Regional Director of the Ministry of Corporate Affairs and Official
Liquidators if, as a result of the amalgamation, one of the companies is to be liquidated/dissolved.
If the transferor or transferee company or both are listed on a recognised stock exchange, the draft re-organisation
proposal requires prior approval of the stock exchange before application is made to the High Court.
In the case of an acquisition or change in control of a listed company, the acquirer must provide an exit opportunity to
the shareholders through a timely public offer with appropriate disclosures. In prescribed cases, subject to conditions
(such as including an inter se transfer of shares between the promoter and the foreign collaborators, and inter-group
transfers), no exit option is required.
The government can order the amalgamation of two or more companies if this is in the public interest.
The Board for Industrial and Financial Reconstruction can issue an order under the Sick Industrial Companies (Special
Provisions) Act, 1985, for the amalgamation of an ailing industrial company with another company.
Indian companies are permitted to acquire businesses/companies abroad if conditions are satisfied.

3.0 Foreign investment

3.1 Foreign investment incentives and restrictions

Many foreign companies involved in India use a combination of exporting, licensing and direct investment. India permits
100% foreign equity in most industries. Firms setting up in export-processing zones (EPZs) or special economic zones
(SEZs), operating in electronic-hardware or software-technology parks, or operating as 100% export-oriented units, may
also be fully foreign-owned. Nevertheless, the government has set sector-specific caps on foreign equity in certain
industries, such as basic and cellular telecommunications services, banking and civil aviation.

India’s investment incentives are designed to channel investments to specific industries, promote development of
economically lagging regions and encourage exports. The country offers a number of inducements, including tax and
non-tax incentives for setting up new industrial undertakings; incentives for specific industries such as power, ports,
highways, electronics and software; incentives for units in less-developed regions; and incentives for units producing
exports or in EPZs and SEZs.

4
India
International Tax and Incentives include the following:
Business Guide
• Tax holidays, depending on the industry and region.

• Full deductions for research and development (R&D) expenses, including capital outlays (other than those for land) in
the year incurred. (Tax holidays are available to companies engaged exclusively in scientific R&D with commercial
applications.)

• Accelerated depreciation for some categories, such as energy-saving, environmental-protection and pollution-control
equipment.
The central government’s development banks and the state industrial development banks extend medium- and long-
term loans and sometimes take equity in new projects. Some Indian states provide additional incentives.

3.2 Exchange controls

The government sets India’s exchange-control policy in conjunction with the Reserve Bank of India (RBI, the central
bank), which administers foreign-exchange (forex) regulations. The Foreign-Exchange Management Act of 2000
established a simplified regulatory regime for forex transactions and liberalised capital-account transactions. It also
appointed the RBI as the sole monitor of all capital-account transactions.
The rupee is fully convertible on the current account. Forex activities are permitted unless specifically prohibited. Every
transaction involving forex is subject to controls set out in the RBI’s Exchange Control Manual, which specifies
procedures to be followed by authorised dealers, mainly banks licensed to deal in forex transactions.
The RBI allows branches of foreign companies operating in India to remit profits to their head offices through authorised
forex dealers without prior approval. Forex cover can be obtained for all genuine transactions from authorised dealers,
such as for dividend remittances.

4.0 Choice of business entity

4.1 Principal forms of doing business

The principal forms of doing business in India are:
• Companies — public or private;
• Association of persons;
• Representative office of a foreign company;
• Partnerships; and
• Trusts.

Companies — public or private

Companies incorporated in India are governed by the Companies Act, 1956, which is administered by the Ministry of
Corporate Affairs (MCA) through the Registrar of Companies at the lowest level, and the Regional Director at the
higher. The Company Law Board is the appellate authority in certain circumstances.

Companies are broadly classified as private limited companies and public limited companies. Companies may have
limited or unlimited liability (liability of its members is unlimited). A limited liability company can be limited by shares
(liability is limited to the amount unpaid on shares subscribed) or by guarantee (liability is limited to the amount for
which a guarantee is given). Companies limited by shares are common. The limited company is the corporate form most
often used in India.
Private limited company. A private limited company is a company whose articles of association provide for the
following restrictions:
• Restriction on the transfer of its shares;
• Limits the number of members to 50 (excluding employees and former employees);

• Prohibits invitation to the public to subscribe to its shares and debentures;

• Prohibits invitation to accept deposits from persons other than its members, directors and their relatives; and
• A minimum paid up capital of INR 100,000.

A private company should have at least two directors and at least two members. A private company need not publish all
of its financial data and it may allot shares without a prospectus. Private companies are subject to less supervision under

5
India
International Tax and the Companies Act than public companies. Provisions governing the managerial remuneration of directors, restrictions
Business Guide on the powers of the board of directors, prohibitions against loans to directors, additional issues of shares to existing
shareholders, retirement of directors by rotation, appointment of the managing director and audit committee, passing
of resolutions by postal ballot, restrictions on inter-corporate investments/loans, obtaining a certificate of
commencement of business, among others, do not apply to private companies.

Public limited company. A public limited company must have a minimum paid-up capital of INR 500,000. Any private
company that is a subsidiary of a company that is not a private company is a public company. A private company that is
the subsidiary of a foreign body corporate, which, if incorporated in India, would be a public company within the
meaning of the Companies Act, will be deemed to be a subsidiary of a public company if the entire share capital of the
Indian private company is not held by one or more foreign body corporates.
Public limited companies can be closely held, unlisted or listed on the stock exchange.

Overview of important provisions

Founders, shareholders. Minimum number of members are required to form a private company (seven in the case of a
public limited company). A foreign national or a non-resident may be a shareholder.
Board of directors. A public limited company should have a minimum of three directors and a maximum of 12 (any
increase requires the approval of the MCA). No restrictions on residence or citizenship of directors. Directors cannot hold
more than 15 directorships of public companies and must disclose their interest in any contract with interested parties.
They cannot participate and vote at board meetings of public companies when resolutions affecting such contracts are
taken up. Directors are elected by simple majority or by methods provided in the articles of association. There is also
provision for appointment by proportional representation.
Board meetings must be held once every quarter. Barring certain exceptions, the board has full powers and may
delegate its powers to a committee of the board. Salaries and perquisites for directors of a public company are subject
to ceilings for companies with inadequate profits.
Dividends. Dividend for a financial year can be paid out of profits of that year after providing for depreciation or out of
profits of any previous financial year(s) arrived at after providing for depreciation and remaining undistributed profits, or
out of both. Losses or depreciation of earlier years (whichever is lower) must be adjusted from the profits before
payment of dividends. Before declaring dividends out of the current year’s profit, the company must transfer between
2.5% and 10% of its current profits to reserves depending on the rate of the dividends declared.
Sole selling agencies. The company may appoint a sole selling agent for a maximum period of five years. If a company
has paid-up capital of more than INR 5m, central government approval is required for the appointment. The government
can prohibit the appointment of a sole selling agent in certain industries in which demand substantially exceeds supply.
Management. Public companies with paid-up capital of INR 50m or more must appoint a managing director or
full-time director or manager. The term of a managing director/manager is a maximum of five years but may be
renewed. Managing directors may hold that position in no more than two public companies. A public company with
paid-up capital of INR 50m or more must set up an audit committee. A listed company must comply with the code of
corporate governance, including among others composition of the Board of Directors, audit committee, CEO/CFO
certifications and disclosures.
Disclosure. Books of accounts must be maintained and open to inspection for directors, government officers or officers
of the Securities and Exchange Board of India (SEBI) in the case of listed companies, and they must be kept for the
preceding eight years. A company must appoint statutory auditors, who must be chartered accountants. Holders of
shares or debentures must receive audited balance sheets and profit-and-loss statements before annual meetings.
Types of share capital. There are two types of shares under Indian Company Law:
• Preference shares. Shares that carry preferential rights in respect of dividends at a fixed amount or at a fixed rate
before the holders of the equity shares can be paid, and carry preferential rights with respect to the repayment of
capital on winding up or otherwise. In other words, preference share capital has priority both in repayment of
dividends and capital.

• Equity shares. Shares that are not preference shares. A public company may issue equity shares with different
dividend or voting rights or otherwise for up to 25% of the total share capital issued if it has distributable profits in
the preceding three years and has complied with other requirements. A private company may freely issue shares with
differential rights as to dividends, voting or otherwise provided this is permitted in its articles of association.
General meeting. A general shareholders’ meeting, called the Annual General Meeting (AGM), must be held at least
once in a year and the time between two AGMs should not exceed 15 months. The financial year of a company may be
less or more than a calendar year but it may not exceed 15 months (extendable up to three months by the Registrar of
Companies, ROC). A general meeting other than the AGM (Extraordinary General Meeting) can be called by the board
of directors at the request of holders of 10% of the paid-up share capital.

6
India
International Tax and A quorum is established when five members (two in the case of a private company), or more, according to a company’s
Business Guide articles, are personally present at a meeting. If a quorum is not present, the meeting is adjourned until the following
week, at which time all members present, regardless of number, constitute a quorum.
There are two kinds of resolutions: ordinary and special. An ordinary resolution may be passed by a simple majority of
members present or represented by proxy. Special resolutions require a 75% vote; these include among others proposals
for liquidation, transfer of the company’s offices, buyback of securities, amendment of articles of association and
increases in inter-corporate investment.
Holding of shares in dematerialised form. Securities can be held in electronic (dematerialised) form through the
depository mode. In the case of public/rights issue of securities of listed companies, the company must give investors an
option to receive the securities in material or electronic form.

Association of persons
An association of persons is a collection of different entities joined together for a common purpose. It can be formed by
individuals, limited companies and others, and it need not register with the authorities. An association of persons is
usually formed by the execution of an agreement between the participants. However, in certain cases where a formal
relationship may not be evident from documents, the conduct of the parties can give rise to a presumption of the
existence of an association of persons. The documents governing an association of persons usually contain provisions for
its internal management, administration, the distribution of income and the distribution of assets in a winding up. The
association of persons is a recognised entity for tax purposes.

Representative office of a foreign company

A foreign company aiming to set up business operations in India can do so as through a liaison office/representative
office, project office or a branch.

Liaison office/representative office

Liaison offices are akin to representative offices and are prohibited from generating income. Expenses of a liaison office
must be met through currency remittances from the head office. Liaison offices may place export orders with Indian
companies on behalf of their head office and carry on normal activities related to exports. A liaison office cannot
undertake any commercial activity directly or indirectly.

Project office
Foreign companies planning to execute specific projects in India can set up temporary project/site offices in India for the
purpose of carrying out activities only relating to that project.

4.2 Establishing a branch

Branch office
Foreign companies engaged in manufacturing and trading may establish a branch to transact specified activities
as follows:
• Export/import of goods;
• Rendering of professional or consultancy services;

• Carrying out research for the head office;

• Promoting technical or financial collaboration between Indian companies and the head office or an overseas group
company;

• Representing the head office in India and acting as a buying/selling agent in India;
• Rendering services in information technology and development of software in India;
• Rendering technical support for products supplied by the head office/group companies; and

• Foreign airline/shipping companies.

A branch of a foreign company, a representative office or a liaison office must be registered with the ROC and file
annual prescribed financial statements.

Partnerships
Partnerships, as a form of business, are seldom used by foreign investors. The partnership form may be considered,
however, where a foreign enterprise is to undertake a contract job in association with an Indian business.

7
India
International Tax and The maximum number of partners in a partnership is 20. A partnership must be registered with the Registrar of Firms
Business Guide under the Indian Partnership Act, 1932. An unregistered partnership may not file suit to enforce a right arising from a
contract or under the Partnership Act against third parties. Similarly, no suit can be instituted by a person suing as a
partner of the firm against an unregistered firm or any partner of such a firm. The liabilities of partners are unlimited.
Partnerships are recognised entities for tax purposes.

The government has introduced a bill in parliament to pave the way for the introduction of limited liability companies
(LLCs).
No person resident outside India other than a non-resident Indian (NRI) or a person of Indian origin (PIO) can make an
investment by way of contributing to the capital of a firm or a proprietorship concern or any association of persons in
India. The Reserve Bank of India (RBI, the central bank) may, on application, permit a person resident outside India (other
than an NRI/PIO) to make such an investment subject to such terms and conditions as may be considered necessary.

Trusts
In some circumstances, trusts are used to hold investments and conduct business operations.

4.3 Setting up a company

A foreign company can commence operations in India by incorporating a company under the Companies Act, 1956,
which can be a joint venture company or a subsidiary (including a wholly owned subsidiary).
Private or public companies are formed by registering the memorandum and articles of association (specifying
name, objects, capital, registered office, liability) and prescribed forms with the ROC in the state where the
headquarters or main office is to be located. If the documents are in order, the ROC grants a certificate of incorporation.
E-filing is compulsory.
All directors/proposed directors must obtain a Director Identification Number. Directors must also obtain a Digital
Signature Certificate from the certifying authority for electronic filings.

5.0 Business taxation

5.1 Overview
Corporate tax rates have been lowered in recent years in keeping with the government’s aim to broaden the tax base
and ensure greater compliance. However, the underground economy remains large, with smaller businesses and
individuals often operating outside the formal economy. The government has offered tax amnesties in the past to bring
this money back into the regular economy and encourage tax payments.
In addition to direct corporate income tax, companies in India are subject to a minimum alternative tax, wealth tax,
capital gains tax, fringe benefits tax, dividend distribution tax and indirect taxes such as value-added tax (VAT), service
tax, excise duties and various levies of the individual states and municipalities.
Tax incentives focus mainly on the setting up of new industries, encouraging investments in backward areas,
infrastructure and promoting exports. Export and other foreign-exchange earnings were previously favoured with
income tax incentives but these have generally been phased out except for predominantly export-oriented units. The
Special Economic Zones Act 2005 grants fiscal concessions for both developers and units in the special economic zones
(SEZs) and a legislative framework for setting up offshore banking units and international financial service centres.

5.2 Taxable income and rates

The corporate tax rate for domestic companies is 30%, along with a surcharge of 10%, where the total income exceeds
INR 10m. In addition, a 2% education cess and 1% secondary and higher education cess (collectively referred to as
“cess”) on all taxes, including indirect and service taxes, is levied. The 3% cess applies to the aggregate amount of
income tax plus the surcharge. The effective tax rate for domestic companies is therefore 30.9% (where income is less
than or equal to INR 10m) and 33.99% (where income exceeds INR 10m).
A company is considered a domestic company for tax purposes if it is incorporated in India or if it has made prescribed
arrangements for the declaration and payment in India of dividends payable out of income liable to tax.
Non-resident companies and branches of foreign companies are taxed at a rate of 40%, plus a 2.5% surcharge where
the total income exceeds INR 10m, and the 3% cess, bringing the effective tax rate to 41.2% (where income is less than
or equal to INR 10m), and 42.23% (where income exceeds INR 10m). The taxable income of non-resident companies
engaged in certain businesses is deemed to be 10% of the amounts they are paid. Such businesses include services for
prospecting, extracting or producing mineral oils, as well as construction, testing and commissioning plant and
machinery connected to turnkey power projects approved by the government. Similarly, presumptive income is deemed

8
India
International Tax and to be 7.5% of amounts paid to shipping enterprises and 5% for operating aircraft. Such non-resident companies may
Business Guide opt to be assessed on a presumptive or net income basis.

A minimum alternative tax (MAT) is also imposed on corporations. If a company’s tax liability is less than 10% of book
profits, the book profits are deemed to be total income and are charged to tax at 10%, plus the applicable surcharge
and cess. Thus the effective MAT rate for a domestic company is 10.3% for total income up to INR 10m, and 11.33%
for total income exceeding INR 10m (rates comprise the base rate of 10%, plus the applicable surcharge of 10% and
the 3% cess). For non-resident companies, the effective MAT rate is 10.3% for total income up to INR 10m, and
10.5575% for total income exceeding INR 10m (rates comprise the base rate of 10%, plus the applicable surcharge of
2.5% and the 3% cess).
A credit is available for the MAT paid against tax payable on normal income, and this may be carried forward for offset
against income tax payable in the following seven years.

The simplified example below shows the tax burden on a public company that is 40% foreign-owned. This example
assumes taxable income of INR 10.1m and remittance to the foreign partner of 40% of after-tax earnings as dividends.

Corporate taxation, 2007–08

Taxable income INR 10,100,000

Total income tax (33.99%*) 3,432,990
Distributable profits 6,667,010
Dividends remitted abroad 2,666,804
Tax on distributed dividends (16.995%) 453,223
Total taxes payable 3,886,213
Total tax burden as a % of taxable income 38.477
*Surcharge of 10% applicable where income exceeds INR 10m.

Taxable income defined

Resident companies are subject to tax on gross worldwide income less allowable deductions (essentially, outlays incurred
exclusively for business purposes). Non-residents are taxed on income derived from a permanent establishment or a
business connection in India, and other India-source income.
Dividends paid by a domestic company are exempt from tax in the hands of the recipient provided dividend distribution
tax was paid by the distributing company. Under current tax law, a domestic company is required to pay dividend
distribution tax of 15% (plus a surcharge of 10%) on any amounts declared, distributed or paid as dividends. Adding in
the 3% cess brings the effective rate of the dividend distribution tax to 16.995%. Dividends on which dividend
distribution tax has not been paid are taxed in the hands of the recipient as income at the normal rates.

Deductions
In computing taxable income, various deductions are taken into account. These include expenditures for materials,
wages, salaries, reasonable bonuses and commissions, rent, repairs, insurance, royalty payments, interest, dividends,
lease payments, certain taxes (sales, municipal, road, property and expenditure taxes and also customs duties),
depreciation, expenditures for scientific research and contributions to scientific research associations and professional
fees for tax services.
Specific deductions are allowed as follows:
• A 100% deduction for interest payments on borrowed capital, except in certain cases where the capital is borrowed
for the acquisition of an asset for extension of the business.
• Capital expenditure on research conducted in-house (this can rise to 150%) and for payments made for scientific
research to specified organisations (125% for payments to a national government laboratory, certain educational
institutions and certain approved research programmes).
• Interest, royalties and fees paid outside of India to overseas affiliates or in India to a non-resident provided tax as
required is withheld.
• Payments to employees under voluntary retirement schemes may be deducted over five years. To encourage
companies to employ additional workers, an amount equal to 30% of additional wages paid to new employees is
allowed as a deduction for three years.
• Business losses (see below).

9
India
International Tax and Indian tax law does not permit companies to take a deduction for a general bad-debt reserve, although specific
Business Guide bad debts may be deducted when written off. Expenses incurred for raising share capital are not allowable as a
deduction from profits, as the expenditure is considered to be capital in nature. No deduction is allowed for
expenditure incurred on income that is not taxable or for payments incurred for purposes that are an offence or
prohibited by law or which were subject to withholding tax by the payer and such withholding obligation has not or
has been incorrectly administered.
Indian branches of foreign corporations may only claim limited tax deductions for general administrative expenses
incurred by the foreign head office. These may not exceed 5% of the year’s income or actual payment of head office
expenditure attributable to the Indian business during the year (unless otherwise provided for in a relevant tax treaty),
whichever is lower.

Depreciation
Asset depreciation is usually calculated according to the declining-balance method (except for assets of an
undertaking engaged in the generation or generation and distribution of power for which the straight-line method
is used). Depreciation is based on actual cost, that is, the purchase price plus capital additions, including certain
installation expenses.
The depreciation rate on general plant and machinery is 15%. Subject to certain conditions, additional depreciation on
new plant and machinery acquired on or after April 1st 2005 may be available at 20% of the actual cost. Factory
buildings may be depreciated at 10%; furniture and fittings at 10%; computers and software at 60%; energy-saving
devices at 80%; and environmental protection equipment at 100%. Depreciation is allowed at 100% for buildings
acquired after September 1st 2002 for the installation of machinery or plant, but only for water-supply projects or
water-treatment systems put to use as infrastructure facilities.
Depreciation is 50% of normal rates if an asset is used for less than six months per year. Depreciation allowances on
buildings, machinery, factories and factory equipment, or furniture are also available on assets partly owned by a
taxpayer. Unabsorbed depreciation may be carried forward indefinitely.
Capital assets purchased for scientific research may be written off in the year such expenditure is incurred. Preliminary
outlays for project or feasibility reports (limited to 2.5% of the cost of the project or capital employed) may be amortised
over ten years from the commencement of business if incurred before March 31st 1998. Expenses incurred after that
date may be amortised over five years up to 5% of the cost of the project or capital employed.
For succession in businesses and amalgamation of companies, depreciation is allowed to the predecessor and the
successor, or the amalgamating and amalgamated company, in the ratio of the number of days that they used
the assets.
If an asset has been sold and leased back, the actual cost for computing the depreciation allowance is the written-down
value to the seller at the time of transfer.
Certain types of intangible assets that have been acquired may be amortised at a rate of 25%.

Losses
Losses arising from business operations in an assessment year may be carried forward and set off against future business
profits in the next eight assessment years. Business losses may be carried forward only if the tax return is filed by the due
date. Closely held companies must satisfy a 51% continuity of ownership test to qualify for business loss carry-forward.
Losses arising from the transfer of short-term capital assets during an assessment year may be set off against capital
gains (whether long- or short-term) arising during the assessment year. The balance of losses, if any, may be carried
forward for offset against capital gains in the next eight years. Long-term capital losses may be set off only against
long-term gains during the year. The balance of losses, if any, may be carried forward for the next eight assessment
years for offset from long-term capital gains. Losses may be carried forward only if the tax return is filed by the due
date. However, unabsorbed depreciation loss can be carried forward indefinitely even if the tax return is not filed by the
due date.

Business reorganisations
Special provisions in the Income Tax Act make qualifying business reorganisations, such as amalgamations or demergers,
tax-neutral provided specific conditions are satisfied.
The transfer of a capital asset in an amalgamation by the amalgamating company to the amalgamated company is
exempt from capital gains tax subject to certain conditions. In a cross-border scenario, when a foreign holding company
transfers its shareholding in an Indian company to another foreign company as a result of a qualifying amalgamation,
such transfer of the capital assets is exempt from capital gains tax in India subject to certain conditions.
In the case of a merger, the shareholder of the amalgamating company would be allotted shares in the amalgamated
company. Such relinquishment of shares of the amalgamating company held by the shareholders is not regarded as a

10
India
International Tax and transfer of shares and, subject to prescribed conditions, is exempt from capital gains tax. When the shares of the
Business Guide amalgamated company are transferred by the shareholder, the acquisition costs will be deemed to be the acquisition
costs of the shares of the amalgamating company.
Subject to satisfying certain conditions, business losses, as well as unabsorbed depreciation of an amalgamating
company owning an industrial undertaking, ships, hotels, banking, telecommunications or information technology
services company, may be carried forward by the amalgamated company. To set off and carry forward losses and
unabsorbed depreciation, the amalgamated company must retain at least 75% of the book value of fixed assets of
the absorbed unit and it must continue business of the amalgamating company for a minimum period of five years. The
unit itself should have been engaged in the business for at least three years, during which time the loss or depreciation
was accumulated, and should have held at least 75% of the book value of fixed assets for two consecutive years before
the merger.

Where an undertaking of an Indian company that is entitled to an exemption/deduction under the Income Tax Act is
amalgamated, the benefit of the deduction/exemption is available to the amalgamated company.
Under a demerger, all of the assets and liabilities of the demerging company are transferred to the resulting company,
and in consideration, the resulting company issues its shares to the shareholders of the demerging company. Provided
certain conditions are satisfied, the transfer of assets by the demerged company to the resulting company is exempt
from capital gains tax. To qualify for the exemption, the resulting company must be an Indian company. Where an
undertaking of an Indian company that is entitled to exemption/deduction under the Indian Income Tax Act is
demerged, the benefit of certain specified deductions/exemptions are available to the resulting company.
Expenditure incurred by an Indian company for an amalgamation or demerger of an undertaking may be amortised over
a five-year period.

5.3 Capital gains taxation

Gains derived from the disposition of capital assets are subject to capital gains tax. The tax treatment of capital gains
depends on whether the gains are long-term or short-term. The minimum holding period for long-term capital gains is
three years, although this period is reduced to one year in the case of shares and specified securities/bonds and units of
mutual funds.
Short-term capital gains on listed shares and units of an equity-oriented mutual fund are taxed at a rate of 10% (plus
the applicable surcharge and the 3% cess). Long-term capital gains (on listed shares and units of equity-oriented funds
held for at least one year) are exempt. However, a securities transaction tax applies (see 5.7 below).
Non-residents pay capital gains tax on the sale of securities, based on the value of the securities in the foreign currency
in which they were purchased. The capital gains are reconverted into rupees and taxed. No inflation index is applied.
Long-term capital gains of foreign institutional investors on listed shares and units of equity-oriented mutual funds are
exempt, and short-term capital gains on such assets are taxed at 10% plus the applicable surcharge and cess, and the
securities transaction tax.
Other long-term capital gains derived by residents (that is, gains not arising from listed securities) are taxed separately
from ordinary income at 20% plus the applicable surcharge and cess. In calculating long-term gains, the costs of
acquiring and improving the capital asset are linked to an inflation index published by the government. The holder of an
asset purchased before April 1st 1981 may use the fair market value of the asset on that date as the cost basis for
computing the capital gain. This generally reduces tax liability.
Gains from the sale of long-term capital assets are exempt from capital gains tax if they are reinvested in certain
securities (subject to an annual cap of INR 5m) within six months and locked in for three years.

5.4 Foreign income and tax treaties

India has comprehensive double-taxation treaties in force with many countries. There are also agreements limited to
aircraft profits and shipping profits.
Most of India’s treaties grant relief from double taxation by the credit method or by a combination of the credit and
exemption methods.
The Authority for Advance Rulings will issue rulings on the tax consequences of transactions or proposed transactions
with non-residents. Rulings are binding on the applicant and the tax authorities for the specific transaction(s).

The table below sets out the withholding tax rates in India’s tax treaties. India does not levy withholding tax on
dividends distributed or paid by a domestic company, so the table only reflects the withholding tax on interest
and royalties.

11
India
International Tax and Treaty partner Interest
(1)
Royalties
(2)

Business Guide
Armenia 10 10
Australia 15 10/15/20
Austria 10 10
Bangladesh 10 10
Belarus 10 15
Belgium 10/15 10
Brazil 15 15/25
Bulgaria 15 15/20
Canada 15 10/15/20
China 10 10
Cyprus 10 10/15
Czech Republic 10 10
Denmark 10/15 20
(3) (3)
Egypt 20.6/21.115 10.3/10.5575
Finland 10 10/15/20
France 10 10
Germany 10 10
(3) (3)
Greece 20.6/21.115 10.3/10.5575
Hungary 10 10
Indonesia 10 15
Ireland 10 10
Israel 10 10
Italy 15 20
Japan 10 10
Jordan 10 20
Kazakhstan 10 10
Kenya 15 20
Korea (ROK) 10/15 15
Kyrgyz Republic 10 15
(3) (3)
Libya 20.6/21.115 10.3/10.5575
Malaysia 10 10
Malta 10 10/15
(3)
Mauritius 20.6/21.115 15
Mongolia 15 15
Morocco 10 10
Namibia 10 10
Nepal 10/15 15
Netherlands 10 10
New Zealand 10 10
Norway 15 104
Oman 10 15
Philippines 10/15 15
Poland 15 22.5
Portugal 10 10
Qatar 10 10
Romania 15 22.5
Russia 10 10

12
India
International Tax and Treaty partner Interest
(1)
Royalties
(2)

Business Guide
Saudi Arabia 10 10
Singapore 10/15 10
Slovenia 10 10
South Africa 10 10
(4)
Spain 15 10/20
Sri Lanka 10 10
Sudan 10 10
Sweden 10 10
Switzerland 10 10
Syria 7.5 10
Tanzania 12.5 20
Thailand 10/25 15
Trinidad & Tobago 10 10
Turkey 10/15 15
Turkmenistan 10 10
Uganda 10 10
Ukraine 10 10
United Arab Emirates 5/12.5 10
United Kingdom 10/15 10/15/20
United States 10/15 10/15/20
Uzbekistan 15 15
Vietnam 10 10
Zambia 10 10
(1) Interest earned by the government and certain institutions is generally exempt from taxation in the source country. These exemptions are
not reflected in the table. Under Indian domestic law, the withholding tax rate for interest paid outside of India is 20%, plus a 2.5% surcharge
(if payment exceeds INR 10m) and a 3% cess. The withholding tax deductible is therefore 20.6%/21.115%. (2) Under Indian domestic law, the
withholding tax rate for royalties paid outside of India is 10%, plus a 2.5% surcharge (if payment exceeds INR 10m) and a 3% cess, provided
certain conditions are satisfied. The withholding tax is therefore 10.3%/10.5575%. (3) Where no maximum withholding tax rate is specified in
the treaty, or the maximum rate specified is higher than the domestic withholding tax rate, the domestic rate applies. (4) The rate is reduced
under the most-favoured-nation clause.

5.5 Transactions between related parties

Transfer pricing
The transfer-pricing regime, introduced in 2002, is influenced by OECD norms, although the penalties are more
stringent. Definitions are provided for “international transaction”, “associated enterprise” and “arm’s-length price”.
The definition of associated enterprise extends beyond shareholding or management relationships, as it includes some
deeming clauses. In the case of an arm’s-length price, it has a provision of range that is +/-5% from comparable
uncontrolled transactions.

The transfer-pricing rules require the assessee to maintain certain information and documents and obtain a certificate
(in a prescribed format) from a chartered accountant furnishing the details of international transactions with associated
enterprises, along with the methods applied for benchmarking.

Where the application of the arm’s-length price would reduce the income chargeable to tax in India or increase the loss,
no adjustment is to be made to the income or loss. In case of an adjustment made to a company enjoying a tax holiday,
the benefit of the holiday will be denied in relation to the adjustment made.

Dividends
Dividends paid by a domestic company are exempt from tax in the hands of the recipient provided dividend distribution
tax was paid by the distributing company.

Interest

Under Indian domestic law, the withholding tax rate for interest paid outside of India is 20%, plus a 2.5% surcharge (if
payment exceeds INR 10m) and a 3% cess. The withholding tax deductible is therefore 20.6%/21.115%.

13
India
International Tax and Royalties
Business Guide
The withholding tax rate for royalties paid outside of India is 10%, plus a 2.5% surcharge (if payment exceeds INR 10m)
and a 3% cess, provided certain conditions are satisfied. The withholding tax is therefore 10.3%/10.5575%.

Controlled foreign companies

India currently does not have anti-haven (CFC) rules.

Thin capitalisation

India currently does not have thin-capitalisation rules.

Consolidated returns

India currently does not allow consolidated returns.

5.6 Turnover and other indirect taxes and duties

Value-added tax (VAT)

All but two of the Indian states moved to the value-added tax regime in 2005. The VAT is a broad-based “consumption–
type destination-based VAT”, driven by the invoice tax credit method. However, the origin–based central sales tax still
co-exists and will be phased out over several years. Salient features of the VAT regime are as follows:
• The inputs involved in the manufacturing of goods for sale within the state and the goods purchased within the
state from registered dealers are available as VAT credits, which may be adjusted against the output on sale within
the state.
• Central sales tax (CST) will continue to co-exist with the state VAT. Inter-state procurement, on which CST is charged
by the originating state, will not be eligible for input tax credit.
• Goods sent on consignment sale or branch transfers outside of the state are not subject to VAT but will be subject to
the “burnout” up to 4% on tax credit.
• The state is not authorised to impose state VAT on the imports of goods into India or exported out of India. Exports
are zero-rated; imports are exempt from import-VAT (that is, free from a reverse charge).
• The state VAT rates have been set on a uniform basis at 4% and 12.50%.
• The new regime calls for comprehensive self-assessment of VAT.

Service tax
A service tax of 12% (12.36% including the education cess) applies to more than 100 services, including advertising,
broking, business auxiliary, business support, banking and financial consulting, club or other association, construction,
credit rating, management consulting, financial leasing, franchise services, credit-card services, merchant banking, cargo
handling, cable operation, storage and warehousing, intellectual property services, renting of commercial property and
works contract services.
India increasingly relies on the taxation of the services sector to broaden the indirect tax base. The scope of taxable
services extends to services provided outside of India. However, the person or entity receiving a taxable service in India is
responsible for paying the service tax if the service is provided by a non-resident or foreign firm that does not have an
office in India.

Excise duty is imposed primarily on the price actually paid or payable for a product, but it is sometimes levied
on the basis of the maximum retail price or transaction value. A three-tiered excise duty structure of 8%, 16% and
24% applies.

Customs duty is levied by the central government on imports and exports as prescribed in the Customs Tariff Act. The
peak rate of basic duty is 15%, but this excludes agricultural, dairy and other selected products.

14
India
International Tax and 5.7 Other taxes
Business Guide
Securities transaction tax
Securities transaction tax is imposed on the purchase or sale of shares in a company where the transaction takes place
on a recognised stock exchange in India. Rates of the tax are as follows:

• 0.025% on non-delivery-based payables by the seller;

• 0.017% on derivative trades; and
• 0.125% on delivery-based equity trades, split equally between the buyer and seller.

A rebate of the securities transaction tax is allowed on securities transactions taxed as business profits.

Wealth tax

In addition to income tax, all companies must pay a 1% wealth tax on the aggregate value of specified assets, net of
debt secured on, or incurred in relation to, those assets. The wealth tax applies to amounts that exceed INR 1.5m of
specified assets.

Fringe benefits tax

A “fringe benefits tax” of 30% (plus surcharge and cess) is imposed on the value of fringe benefits that companies
provide or are deemed to provide to their employees. The purpose of the tax is to tax compensation that companies
disguise as expenses or reimbursements. The fringe benefits tax is payable by the employer, and it covers items such as
entertainment, foreign travel, telephones and health-club memberships. Stock options granted to employees also attract
the fringe benefits tax.

Stamp duty
Financial instruments and transactions in India attract stamp duties that are levied under the Indian Stamp Act and the
stamp acts of the various states; the rates vary significantly from state to state. The transfer of specified securities to and
from a depository is not liable for stamp duty.

Real estate duty

Owners of real estate are liable to various taxes imposed by the state and municipal authorities. These taxes vary from
state to state.

Profession tax
Profession tax is a local tax levied on salaried employees and persons carrying on a profession or trade. The rates of
profession tax vary from state to state.

R&D cess
The Research & Development Act, 1986 provides for a levy of 5% on all payments made for the import of
“technology”, which includes import of designs, drawings, publications and services of technical personnel.

Cash transaction tax

A banking cash transaction tax is levied as an anti-tax-evasion measure, with a view to tracking down cash withdrawals
that do not normally leave a trail. The tax is levied at 0.1% on certain cash withdrawals.

Motor vehicle tax

India’s states levy moderate taxes on motor vehicles and freight traffic; the municipalities charge taxes on services and
levy professional fees.

5.8 Tax compliance and administration

India’s fiscal year (April 1st–March 31st) is the uniform accounting year that must be followed for all assessee taxpayers.
Taxes on income in one fiscal year are usually paid in the next fiscal year (“assessment” year). Companies must file a
final return by October 31st of the assessment year, stating income, expenses, taxes paid and taxes due for the
preceding tax year. Returns for non-corporate taxpayers that are required by law to have their accounts audited are also
due on October 31st. All other assessees must submit returns by July 31st.

Assessees claiming tax holidays or carrying forward tax losses have to file their returns on or before the due date.
Companies must make prepayments of their income tax liabilities during the accounting year. These prepayments are
due on June 15th (15% of total tax payable), September 15th (30%), December 15th (30%) and March 15th (25%).
Overpaid amounts are refunded after the filing of final tax returns.

15
India
International Tax and Guidance is issued annually for the scrutiny of tax returns. Moreover, only 2% of returns would be scrutinised. If the tax
Business Guide authorities can prove concealment of income, a 100–300% penalty may be levied on the tax evaded. Refund claims
must be filed within one year of the end of the assessment year.

6.0 Personal taxation

6.1 Residency
For tax purposes, an individual is resident in India if the individual spends at least 182 days in the country in a given year,
or 60 days if the individual has spent at least 365 days in India in the preceding four years. For Indian citizens leaving
India for employment or as members of the crew of an Indian ship and for an Indian citizen/person of Indian origin
working abroad who visits India while on vacation, the threshold for the five-year test is 182 days in the given year
instead of 60 days.

A “not ordinarily resident” individual is one who has either not been a resident in nine out of the ten preceding years or
who has been in India for less than two years during the preceding seven years. As a result, expatriate managers who
have lived in India for two years are normally liable for tax on their foreign income. Since they may claim credits against
foreign taxes paid, however, this is more a procedural irritant than a real increase in liability.

6.2 Taxable income and rates

Personal income tax falls on only about 3.5% of India’s more than 1bn citizens. Since many transactions are made in
cash, most non-salaried individuals avoid paying any personal taxes.
India currently has three personal tax brackets: 10% (of the amount exceeding INR 110,000) for income of
INR 110,001–150,000; 20% (of the amount exceeding INR 150,000, plus INR 4,000) for income of INR 150,001–
250,000; and 30% (of the amount exceeding INR 250,000, plus INR 24,000) for income of INR 250,001 and above.
Those with an income of less than INR 110,000 are exempt from tax and need not file a tax return. The vast majority of
citizens are not liable for personal income tax.
A 10% surcharge applies to individuals with income exceeding INR 1m and the cess of 3% is levied on all direct and
indirect taxes.
Tax on long-term capital gains earned by individuals is generally 20%, except for long-term gains on listed securities,
which are now tax-exempt.

Personal taxation, 2007–08

Taxable income (INR) Tax rate

Less than 110,000 0
110,001–150,000 10% of the amount exceeding INR 110,000
150,001–250,000 INR 4,000 plus 20% of the amount exceeding INR 150,000
250,001 and above INR 24,000 plus 30% of the amount exceeding INR 250,000
Source: Economist Intelligence Unit.

The tax on a resident earning the equivalent of US$20,000, US$50,000 or US$90,000 in fiscal year 2007/08 (April 1st-
March 31st) (or INR 880,000, INR 2.2m or INR 3.96m, at an exchange rate of INR 44:US$1) is approximately as follows:

Personal taxation, 2007–08

Total income INR 880,000 INR 2,200,000 INR 3,960,000

Taxable income 880,000 2,200,000 3,960,000
Income tax (under above rates)* 213,000 609,000 1,137,000
Tax burden (% of total income) 24.20 27.68 28.71
*In addition, a surcharge of 10% of income tax payable applies where total income exceeds INR 1m, and a cess of 3% is levied on both the
income tax and surcharge, if any.

Source: Economist Intelligence Unit.

Determination of taxable income

Residents of India are normally taxed on worldwide income. Persons not ordinarily resident generally do not pay tax on
income earned outside India unless it is derived from a business controlled in India, or the income is accrued or first

16
India
International Tax and received in India or is deemed to have accrued in India. For example, a pension for years of service in India—even if
Business Guide received abroad—is deemed to have accrued in India and is taxable.

Non-residents are liable for tax on income sourced in India, including interest, royalties and fees for technical services
paid by an Indian resident; salaries paid for services rendered in India; and income that arises from a business connection
or property in India.

The tax-exemption limit is INR 110,000 for men (who are not senior citizens), INR 145,000 for resident women below
65 years and INR 195,000 for resident senior citizens. Standard deductions are not allowed. Deductions are allowed for
contributions to life insurance, recognised provident funds, national savings certificates, the national savings scheme,
income from certain mutual funds and dividends, and some educational expenses up to an overall ceiling of INR
100,000. In addition, the following items may be deducted in calculating taxable income:
• Mortgage interest in respect of home loans obtained on or after April 1st 1999, and where the borrower resides in
the residence up to INR 150,000 annually.
• INR 10,000 (INR 15,000 for senior citizens) for medical insurance premiums. Medical expenses actually incurred for
specified ailments are deductible up to INR 40,000 annually.

• Interest on loans for higher education (including interest paid for higher education of spouse and children)
without limit.
• INR 50,000–75,000 for physically handicapped taxpayers or taxpayers with physically handicapped dependents.

• Royalties received by authors of literary, artistic and scientific books and for income from the exploitation of patents
up to INR 300,000.
The tax treatment of perquisites (such as accommodation, furniture and interest-free loans) provided by the employer is
as follows:
• Free or concessional accommodation will be valued at a specified percentage of the employee’s salary depending on
the city where the accommodation is located.
• The use of movable assets (for example, furniture) of the employer will be valued at 10% per annum of the actual
cost of the assets or the amount of rent paid by the employer if the assets are leased. The provision of computers and
laptops is not treated as a perquisite.
• Interest-free or concessional loans exceeding INR 20,000 are presumed to carry interest calculated at the annual rate
charged by the State Bank of India depending on the purpose of the loan.
• Health-insurance premiums paid by the employer and reimbursement for medical expenses of up to INR 15,000
annually are tax-exempt. A leave-travel allowance is tax-free for two journeys in a block of four years.
• Up to INR 500,000 received from voluntary-retirement schemes that conform to prescribed guidelines may be
excluded from taxable income.

6.3 Special expatriate tax regime

Remuneration received by foreign expatriates working in India generally is assessable under the “Salaries” category and
is deemed to be earned in India. Income payable for a leave period that is preceded and succeeded by services rendered
in India and that forms part of the service contract is also regarded as income earned in India. Thus, irrespective of the
residence status of an expatriate employee, the salary paid for services rendered in India is liable to tax in India.

There are no special exemptions or deductions available to foreign nationals working in India, except for local living
allowances, which are exempt to the extent expense is actually incurred. However, a foreign national can make use of a
short-stay exemption following the 90-day threshold limit as prescribed under the Income Tax Act and the 183-day
threshold limit under relevant tax treaties provided all applicable conditions are satisfied.
Where salary is payable in a foreign currency, the salary income must be converted to Indian rupees. For this purpose,
the rate of conversion to be applied is the transfer-buying rate as adopted by the Reserve Bank of India (RBI, the central
bank) on the last day of the month immediately preceding the month in which the salary is due or paid. However, if tax
is to be withheld on such an amount, the amount of tax to be withheld is calculated after converting the salary payable
into Indian currency at the rate of the date on which tax was required to be withheld.

6.4 Capital taxes

All individuals and other specified persons must pay a 1% wealth tax on the aggregate value exceeding INR 1.5m of
non-productive assets such as land; buildings not used as factories; commercial property not used for business or
profession; offices or residential accommodation for employees; gold, silver, platinum and other precious metals, gems
and ornaments; and cars, aircraft and yachts.

17
India
International Tax and Municipalities levy real property taxes (based on assessed value), and states levy land-revenue taxes.
Business Guide
Taxes must be withheld at source among others on rental payments at the rate of 15% for individuals and 20% for
others for use of land or building, exceeding INR 120,000 during any one financial year. The withholding tax rate in
respect of rental payments for use of any plant or machinery is 10%.

7.0 Labour relations and workforce

7.1 Visa and entry requirements

Foreign nationals (except citizens of Nepal and Bhutan) require a valid passport or travel document and a valid visa to
enter India. Visas can be obtained from the Indian embassy/consulate located in the home country of the foreign
national. The following visas are available from Indian embassies/consulates abroad:
Business visa. This is valid for one or more years with multiple entries. Business visas for long-term stays are issued to
individuals visiting India on business for extended periods. This type of visa enables foreign nationals to travel in and out
of the country without having to re-apply for visas every six months. A letter from a sponsoring organisation indicating
the nature of business, the likely duration of stay, places and organisations to be visited and incorporating a guarantee
to meet maintenance expenses, etc, should accompany the application. The duration of stay in India for each visit is only
six months, even though a valid visa may be for more than six months.
Employment visa. These are issued to skilled and qualified professionals or persons who are engaged or appointed by
companies, organisations or economic undertakings as technicians, technical experts, senior executives, etc.
Employment visas are valid for one to five years. An employment visa may be obtained in the home country. A copy of
the contract with the employer has to be enclosed.
Conference visa. These are issued for individuals attending conferences/seminars/meetings in India. A letter of
invitation from the organiser of the conference must be submitted along with the visa application. Delegates may
combine tourism with attending conferences.
Tourist visa. Tourist visas are normally valid for six months and are usually multiple-entry visas, although multiple
entries should be specifically requested at the time of application. Applicants are required to produce documents to
prove their financial standing. Tourists travelling in groups of not less than four under the auspices of a recognised travel
agency may be considered for a collective visa for six months, even though a valid visa may be for more than six months.
Tourist visas for up to five years may be granted if the foreigner is connected with the tourism trade.
Entry visa. These are issued on a case-by-case basis only to persons of Indian origin depending on the purpose of the
visit and eligibility. However, members of the family of a person employed in India are also eligible for an entry visa. An
entry visa is valid for a period of six months to five years, with multiple entries permitted.
Research visa. Individual research projects can be undertaken in Indian universities/higher education institutions after
obtaining a research visa. The approval of the Ministry of Human Resource Development (Department of Education)
should accompany the visa application. The validity of the visa coincides with the research period.
Student visa. These are issued for the duration of the academic course of study or for a period of five years, whichever
is less, on the basis of firm letters of admission from universities, recognised colleges or educational institutions in India.
Change of purpose or institution is not permitted. The validity of all visas is determined from the date of issue.
Transit visa. Transit visas valid for single/double entry for short stopovers for travelling to a third country are available.
These are issued for a maximum period of 15 days with single-/double-entry facilities to bona fide transit passengers
only. Confirmed onward tickets and valid visa for the final destination are required.
Missionaries. Valid for single entry and duration of stay. A letter in triplicate, from a sponsoring organisation indicating
intended destination in India, probable length of stay and nature of duties should be submitted along with a guarantee
for the applicant’s maintenance while in India. Processing of applications for missionaries may take up to three months.
Journalist visa. Journalist visas are given to professional journalists and photographers for up to three months’ stay in
India. The applicant must contact the External Publicity Division of the Ministry of External Affairs on arrival in New Delhi,
and the Office of the Government of India’s Press Information Bureaus in other places.

7.2 The employment market

Competent staff, including technicians and engineers, can be found without much difficulty. Unskilled labour is also
easy to find. Labour shortages are beginning to occur at the highest levels of some service industries, however, especially
in IT-enabled services, financial services and air transport.
The Indian workforce is easy to train. English is widely spoken by managerial and supervisory personnel, and to some
degree by unskilled workers.

18
India
International Tax and The increasing number of multinational companies has spurred competition among them, making it more difficult to
Business Guide retain managers. The demand for managers is particularly strong in financial services, IT, telecommunications,
infrastructure and retailing. Domestic and multinational companies often offer share options as a way of
boosting compensation.

7.3 Employees’ rights and remuneration

India’s labour laws are complex, with more than 60 pieces of relevant legislation. Employers face particular difficulties in
terminating employment and closing an industrial establishment.

• Workers’ Compensation Act, 1923 provides for compensation to workers for industrial accidents and occupational
diseases resulting in disability and death. The minimum compensation for death is INR 80,000 and for total disability is
INR 90,000. The maximum for death is INR 456,000 and for total disability is INR 548,000.

• Industrial Disputes Act, 1947 covers layoffs, retrenchment compensation, disputes between labour and
management and unfair labour practices. The Act also addresses reinstatement of workers by a labour court or
tribunal order that the employer can appeal against to a higher court. The reinstated worker is entitled to 100% of
wages while the decision of the higher court is pending. The Act also requires industrial establishments with 100 or
more workers to draw up standing orders that specify working conditions (hours, shifts, public holidays, annual leave,
sick pay, termination rules and grievance procedures). These orders must meet minimum state standards and may be
changed only with the consent of the workers or the unions and only to augment benefits. The code of discipline in
industry adopted by the Standing Labour Committee (a type of national conference held by the Ministry of Labour)
defines the rights and responsibilities of employees and workers, and provides for a grievance procedure and the
settlement of disputes by voluntary arbitration.
• Industrial Employment (Standing Orders) Act, 1946 requires employers in industrial employment to define with
sufficient precision the conditions of employment of workers and to make the same known to them.
• Maternity Benefit Act, 1961 regulates the employment of women in certain establishments for certain periods
before and after child-birth and to provide for maternity and other benefits. The Act provides for maternity leave of
12 weeks.
• Payment of Wages Act, 1936 and Minimum Wages Act, 1948 call for industry wage boards to recommend the
minimum wage and fix the wage-rate structure for each industry. The rate varies for central and state government
employees. The minimum wage is INR 66 per day.
• Employees Provident Funds and Miscellaneous Provisions Act, 1952 provides for contribution of PF and pension
for certain establishments engaging a specified number of employees. In practice, several industries are covered under
the provident fund laws. Employers and employees contribute 10–12% (depending upon the type of industry) of
wages per month. Out of the employer’s contribution, 8.33% of the wages (up to INR 6,500) goes towards the
pension fund and the balance towards the provident fund. Employees contribute only to the provident fund.
Government employees joining from January 1st 2004 are entitled to pension benefits under the defined contribution
pension scheme only. The government is considering participation of private/foreign players in the pension sector.
• Payment of Bonus Act, 1965 provides for bonus payments to persons employed in certain establishments on the
basis of profits/ production/productivity. Bonus for workers earning INR 3,500 or less per month (minimum of 8.33%
and a maximum of 20% of annual wages in factories employing ten or more), subject to a maximum of INR 6,000.
• Payment of Gratuity Act, 1972 requires employers to pay a gratuity to workers who have rendered continuous
service for at least five years at the time of retirement/ resignation/superannuation, etc, at the rate of 15 days’ wages
for every completed year of service up to a maximum of INR 350,000.
• Equal Remuneration Act, 1976 prohibits job and wage discrimination based on sex.
• Employees’ State Insurance Act, 1948 provides for certain benefits to employees for sickness, maternity,
employment injury, etc. The Employees State Insurance Corporation provides health insurance for industrial workers,
in which employers contribute 4.75% of an employee’s wages, and employees contribute 1.75%.
• Essential Service Maintenance Act, 1981 empowers the government to prohibit strikes in any industry declared
essential, which would prejudicially affect the maintenance of any public utility- service, public safety or maintenance
of supplies and services necessary for the life.
• Child Labour (Prohibition and Regulation) Act, 1986 prohibits engagement of children (who are not yet 14 years
of age) in specified sectors.
• Trade Unions Act, 1926 provides for registration of trade unions created for the purpose of regulation of labour
relations.

19
India
International Tax and Working hours
Business Guide
Factories Act 1948 requires maximum working hours of 48 hours per week. In practice, however, office employees
normally work a five-day week of 37–38 hours. Factory workers have on average a six-day week of 43–48 hours. In
most places, any work beyond nine hours per day or 48 hours per week requires payment of overtime at double the
normal wage.

7.4 Wages and benefits

Wages and fringe benefits vary considerably depending on the industry, company size and region. Wages generally have
two components: the basic salary and the dearness allowance, which is linked to the cost-of-living index. The allowance,
paid as part of the monthly salary, may be at a flat rate or on a scale graduated by income group. A mandatory bonus
supplements wages.

Companies use both time and piece rates. The former is more common in organised-factory industries, such as
engineering, chemicals, cement, paper, etc. Rates may be per hour, day, week or month. Piece rates, which the
government has encouraged in order to boost productivity, are usually paid monthly, although casual workers are paid
on a daily basis. Some industries pay production premiums.
In the organised sector, wages are often set by settlements reached between trade unions and management.
Fringe benefits, such as provident funds, pensions and bonuses, normally add 40–50% to the base pay.

Other benefits
To reward the employees for their performance and as a retention tool, Indian firms offer share options to their
employees. These are common in IT, biotechnology, media, telecoms and banks. SEBI has issued Employee Stock Option
Scheme and Employee Stock Purchase Scheme Guidelines, which are applicable to listed companies. Companies are
permitted to freely price the stock options but are required to book the accounting value of options in their financial
statements. The guidelines specify among others a one-year lock-in period, approval of shareholders by special
resolution, formation of a compensation committee, accounting policies and disclosure in directors’ reports.

7.5 Termination of employment

Companies are required to obtain government permission to close an operation or lay off workers in firms with 100 or
more employees. The Industrial Disputes Act requires employers wishing to close an establishment to apply for
permission at least 90 days before the intended closing date. If the government does not issue a decision within 60 days
of the application, approval is deemed granted. A company can appeal a rejection to the Industrial Tribunal. Workers in
an establishment closed illegally (that is, without approval) remain entitled to full pay and benefits.
It is usually difficult for large companies to dismiss staff. Retrenchments and layoffs require full explanation to and the
prior approval of the state government. (Retrenchment under an agreement specifying a termination date requires no
prior notice.) Companies usually follow the last-in-first-out principle.
Compelled by competition to cut wage costs or consider moving out of high-wage locations, several companies
have resorted to voluntary retirement schemes (VRSs) or redeployments. Beneficiaries under an approved VRS of a
private-sector company are exempt from tax on monetary benefits up to INR 500,000. Companies may amortise their
VRS expenses over five years. The government also uses VRSs in the public sector.

7.6 Labour-management relations

With some exceptions, India has company unions rather than trade unions. These are often affiliated with national
labour organisations. Various trade unions are promoted by political parties. The power of the unions is declining as the
government pushes forward its reform agenda.

There are a number of national labour organisations. The Indian National Trade Union Congress (INTUC), the labour
wing of the Congress party, generally favours settlement of labour disputes through arbitration, the wage boards
or the tribunals. The All-India Trade Union Congress (AITUC), affiliated to the Communist Party of India, is a
champion of workers’ rights and strikes. The Centre for Indian Trade Unions (CITU) is affiliated to major industries.
Hind Mazdoor Sabha is affiliated to the International Confederation of Free Trade Unions. Bharatiya Mazdoor Sangh is
affiliated with the Bharatiya Janata Party. In membership terms, only these organisations qualify for recognition as
national trade unions.
In manufacturing companies, prior discussions between management and labour leaders often help to forestall strikes.
When strikes occur, they are usually settled by negotiation or through conciliation boards. It is common practice in many
foreign-owned manufacturing firms to avert strikes by employing a labour welfare officer to act as a go-between for
labour and management. Firms with 500 or more workers must by law have such an officer who acts as personnel
manager, legal adviser on labour law and, in non-unionised companies, a worker representative.

20
India
International Tax and The Industrial Disputes Act, 1947 requires industrial establishments with 100 or more workers to set up works
Business Guide committees to promote measures for securing and preserving amity and good relations between the employer
and workforce.
Collective bargaining has gained ground in recent years, but agreements normally apply only at the plant level.
Collective agreements have traditionally been the norm in banking; such pacts may last up to five years. An industry
association usually negotiates any rare industry-wide agreement.
At the central level, labour policies are managed jointly by the Indian Labour Conference and its executive body, the
Standing Labour Committee, along with the various industrial committees. Representatives from the government,
employers and labour are included in all three groups.

7.7 Employment of foreigners

Expatriate employment in manufacturing industries is generally limited to technical and specialised personnel. Many
foreign affiliates have a few expatriates in India. Permission from the Reserve Bank of India (RBI, the central bank) or
government is not required to employ a foreign national, but the Ministry of Home Affairs, which grants visas and
certain specific appointments, may require government approval in some cases. Foreigners entering India on a Student,
Employment, Research or Missionary Visa that is valid for more than 180 days are required to register with the
Foreigners Registration Officer under whose jurisdiction they propose to stay within 14 days of arrival in India,
irrespective of their actual period of stay. Foreigners visiting India on any other category of long-term visa that is valid for
more than 180 days are not required to register themselves if their actual stay does not exceed 180 days on each visit. If
such a foreigner intends to stay in India for more than 180 days during a particular visit, that person should register
within 180 days of arrival in India.
It normally takes about three months to obtain an immigration visa, and foreign companies report no problems in
acquiring visas for their technical personnel. The visa is generally granted for the same period as the employment
contract. Once it is obtained, a stay permit is granted; this must be endorsed annually by the state government where
the foreign national resides.
Expatriates are often paid salaries several times those of their Indian counterparts. Domestic private-sector salaries are
rising quickly, although they vary widely among industries.

8.0 General information

• Associated Chambers of Commerce and Industry of India (Assocham), 147B, Gautam Nagar, Gulmohar
Enclave, New Delhi 110 049; Tel: (91.11) 2651 2477-79; Fax: (91.11) 2651 2154; Internet: http://www.assocham.org.
• Authority for Advance Rulings, CBDT, NDMC Building, Fifth Floor, Yashwant Place, Chanakyapuri, New Delhi 110
021; Tel: (91.11) 2611 7792/7802/7935; Fax (91.11) 2611 3407/3890; Internet: http://www.aar.gov.in.
• Bureau of Indian Standards (BIS), Manak Bhavan, 9 Bahadur Shah Zafar Marg, New Delhi 110 002; Tel: (91.11)
2323 0131/3375; Fax: (91.11) 2323 4062/9399; Internet: http://www.bis.org.in.
• Central Board of Direct Taxes (CBDT), Income Tax Department, Department of Revenue, Ministry of Finance, North
Block, New Delhi 110 001; Tel: (91.11) 2309-3621; Fax: (91.11) 2309-2544; Internet:
http://www.incometaxindia.gov.in/cbdt/Org.asp.
• Central Board of Excise and Customs (CBEC), North Block, New Delhi 110 001; Tel: (91.11) 2337-8999;
Fax: (91.11) 2337-0351; Internet: http://www.cbec.gov.in.
• Company Law Board, 5th Floor, A-Wing, Shastri Bhawan, Dr.Rajendra Prasad Road, New Delhi 110 001; Tel: (91.11)
338 2386/3662; Fax: (91.11) 338 2265; e-mail: clb@nic.in; Internet: http://www.clb.nic.in.

• Competition Commission of India (CCI), 14, B wing, Hudco Vishala, Bhikaji Cama Place, New Delhi, 110 066;
Tel: (91.11) 2670 1600/1650; Fax: (91.11) 2610 3859; Internet: http://www.competition-commission-india.nic.in.
• Confederation of Indian Industries (CII), Mantosh Sondhi Centre, 23 Institutional Area, Lodi Road, New Delhi 110
003; Tel: (91.11) 2462 9994; Fax: (91.11) 2462 6149; Internet: http://www.ciionline.org.
• Controller-General of Patents, Designs and Trademarks, CGO Building, 101 Maharshi Karve Road, Mumbai, 400
020; Tel: (91.22) 2203 9050; Fax: (91.22) 2205 3372; Internet: http://www.patentoffice.nic.in.

• Directorate-General of Foreign Trade (DGFT), Ministry of Commerce and Industry, Udyog Bhavan, H-Wing, Gate
No. 2, Maulana Azad Road, New Delhi 110 011; Tel: (91.11) 2306 1562; Fax: (91.11) 2306 2225;
Internet: http://dgft.delhi.nic.in.

• Export Credit Guarantee Corp (ECGC), Express Towers, Nariman Point, Mumbai 400 021; Tel: (91.22) 5659
0500/0510; Fax: (91.22) 5659 0512; Internet: https://www.ecgc.in/portal.

21
India
International Tax and • Export-Import Bank of India (Exim Bank), Centre One Building, Floor 21, World Trade Centre Complex, Cuffe
Business Guide Parade, Mumbai 400 005; Tel: (91.22) 2218 5272; Fax: (91.22) 2218 2572; Internet: http://www.eximbankindia.com.

• Federation of Indian Chambers of Commerce and Industry, Federation House, Tansen Marg, New Delhi 110
001; Tel: (91.11) 2373 8760–70; Fax: (91.11) 2372 1504, 2332 0714; Internet: http://www.ficci.com.
• Foreign Investment Promotion Board (FIPB), Department of Economic Affairs, Ministry of Finance, North Block,
New Delhi 110 011; Tel: (91.11) 2309 4152; Fax: (91.11) 2309 4052;
Internet: http://www.finmin.nic.in/the_ministry/dept_eco_affairs/fipb/fipb_index.htm.
• Indian Investment Centre (IIC), Department of Economic Affairs, Ministry of Finance, Jeevan Vihar, Parliament
Street, New Delhi 110 001; Tel: (91.11) 2373 3679; Fax: (91.11) 2373 2245; Internet: http://www.iic.nic.in.
• Institute of Chartered Accountants of India, ICAI Bhawan, Indraprastha Marg, Poxt Box. No. 7100, New Delhi -
110 002, Telphone:EPABX (011) 39893989, Telegram: CICA NEW DELHI, Internet: http://www.icai.org

• Ministry of Commerce and Industry, Udyog Bhavan, New Delhi, 110 011; Tel: (91.11) 2301 0008; Fax: (91.11)
2301 1312; Internet: http://www.commerce.nic.in.
• Ministry of Commerce and Industry, Udyog Bhavan, New Delhi, 110 011; Tel: (91.11) 2301 0008; Fax: (91.11)
2301 1312; Internet: http://www.commerce.nic.in.
• Ministry Of Corporate Affairs, ‘A’ Wing, Shastri Bhawan, Rajendra Prasad Road, New Delhi 110 001; Tel: 011 -
23384660, 23384470, 23389403; Internet: http://www.mca.gov.in.

• Ministry of Finance (MoF), North Block, New Delhi 110 001; Tel: (91.11) 2309 3998; Fax: (91.11) 2309 2680;
Internet: http://www.finmin.nic.in.
• Ministry of Human Resource Development, Shastri Bhawan, Dr. Rajendra Prasad Road, New Delhi 110 001;
Tel: (91.11) 231-61336; Fax: (91.11) 2338 1355; Internet: http://www.education.nic.in.
• Patent Office, Intellectual Property Office Building, CP-2 Sector V, Salt Lake City, Kolkata 700 091; Tel: (91.33) 2367
1945/46/87; Fax: (91.33) 2367 1988; Internet: http://www.patentoffice.nic.in/ipr/patent/patents.htm.
• Press Information of Bureau; Internet: http://www.pib.nic.in
• Reserve Bank of India (RBI), Central Office, Mumbai 400 001; Tel: (91.22) 2266 1602; Fax: (91.22) 2265 4992;
Internet: http://www.rbi.org.in.
• Secretariat for Industrial Assistance (SIA), Ministry of Commerce and Industry, Udyog Bhavan, New Delhi 110
001; Tel: (91.11) 2301 1983; Fax: (91.11) 2301 1034; Internet: http://www.siadipp.nic.in/sia/default.htm.
• Securities and Exchange Board of India (SEBI), Plot No.C4-A,’G’ Block,Bandra Kurla Complex, Bandra(East),
Mumbai 400 051; Tel: (91.22) 2644 9000/4045 9000; Internet: http://www.sebi.gov.in.
• Trade Marks Registry, Intellectual Property Bhavan, Near Antop Hill Head Post Office, S.M. Road, Antop Hill,
Mumbai 400 037; Tel: (91.22) 2410 1144 /1177, 2414 8251, 2411 2211; Fax: (91.22) 2412 0808, 2413 2295;
Internet: http://www.patentoffice.nic.in/tmr_new/default.htm.

9.0 Office locations

To find out how our professionals can help you in your part of the world, please contact us at the headquarters office
listed below or through the “contact us” button on http://www.deloitte.com/tax.
Deloitte Haskins & Sells
264-265 Vaswani Chambers
Dr. Annie Besant Road
Worli
Mumbai 400 030

22
About Deloitte

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About the Economist Intelligence Unit

The Economist Intelligence Unit (www.eiu.com) is a specialist publisher serving companies establishing and managing operations across national
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