CA Final · Direct Tax Laws & International Taxation · Provisions to Counteract Unethical Tax Practices
Indian concern Aarav Ltd is part of a group with three other Indian concerns, all constituent entities. A transfer of shares of a foreign entity triggers the reporting under Rule 235 of the Income-tax Rules, 2026. The group designates Aarav Ltd to file Form 163 for all, but the group has not conveyed this designation in writing to the Assessing Officer. Aarav files Form 163 only for itself. Which is correct?
The other Indian concerns cannot rely on Aarav's filing. Group filing by one designated concern needs both designation by the group and written communication of the designated concern's details to the Assessing Officer. Since the written intimation was not given, each concern must furnish Form 163 itself.
- AThe condition in rule 235(4)(b) is not met, so the other Indian concerns cannot rely on Aarav's filing and must furnish the information themselvesCorrect
- BAarav's filing discharges all the concerns because designation within the group is enough
- COnly the designated concern must retain documents, and for 8 years
- DRule 235(4) requires the Director General (Systems) to file for the other concerns
Explanation
Rule 235(4) allows one Indian concern to furnish information for the group only if (a) the group designated it and (b) the details of the designated concern were conveyed in writing to the Assessing Officer. Here (b) fails, so the facility is unavailable. Internal designation alone is insufficient; each concern remains responsible for its own furnishing.
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