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CA Final · Direct Tax Laws & International Taxation · Provisions to Counteract Unethical Tax Practices

Rohit Textiles Pvt Ltd, an Indian concern, is notified that a foreign company holding its shares has transferred shares of an overseas entity during the financial year, and the transfer has the effect of indirectly transferring management or control of the Indian concern. Under Rule 235 of the Income-tax Rules, 2026, which statement correctly describes the filing of Form No. 163?

Form No. 163 must be furnished electronically under digital signature to the Assessing Officer having jurisdiction over the Indian concern. Where the transfer changes management or control, directly or indirectly, it is due within ninety days of that transaction, not the year end.

  1. AForm No. 163 is filed electronically under digital signature with the Assessing Officer having jurisdiction over the Indian concern, within ninety days of the transactionCorrect
  2. BForm No. 163 is filed in paper form with the Assessing Officer of the transferor within thirty days of the transaction
  3. CForm No. 163 is filed electronically only at the end of eight years from the relevant tax year
  4. DForm No. 163 is filed electronically within ninety days from the end of the financial year, and the transfer of control makes no difference to the time limit

Explanation

Rule 235(2) requires electronic furnishing under digital signature to the Assessing Officer having jurisdiction over the Indian concern. Where the transaction has the effect of directly or indirectly transferring rights of management or control, the form is due within ninety days of that transaction. The last option is wrong because it ignores this special rule for transfers of management or control.

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