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

Under the Income-tax Rules, 2026, an Indian concern must furnish Form No. 163 where shares of a foreign company holding Indian assets through it are transferred. The transfer took place during a financial year and did not transfer management or control of the Indian concern. What is the time limit for furnishing the form?

The form must be furnished within ninety days from the end of the financial year in which the transfer occurred. The shorter ninety days from the date of the transaction applies only if the transfer directly or indirectly passes management or control of the Indian concern, which did not happen here.

  1. AWithin ninety days from the end of the financial year in which the transfer took placeCorrect
  2. BWithin ninety days of the transfer itself
  3. CWithin thirty days from the end of the financial year
  4. DWithin one hundred and eighty days from the end of the financial year

Explanation

Rule 235(2) requires Form No. 163 within ninety days from the end of the financial year of the transfer. The ninety days from the transaction date applies only where the transfer also transfers rights of management or control of the Indian concern, which is not the case here, so that option is wrong.

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