Foreign company transferring Indian shares to another foreign company

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This discussion addresses whether Tax Deducted at Source (TDS) applies when a foreign holding company transfers its shares in an Indian company to another foreign company, especially when neither has a PAN. Generally, TDS isn't applicable as there's no payment from an Indian entity. However, Indian capital gains tax might apply if indirect transfer provisions are triggered due to the value derived from Indian assets. Specific case laws for this exact scenario were not found.

Hafiz

Hafiz (Querist)

16 March 2025 Foreign holding company transferring its holding in shares of Indian company to an another foreign company.

Whether provisions of TDS applicable in this case? Both the foreign companies is not having PAN.

Any case laws is there in connection with the same?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

13 April 2025 TDS provisions are generally not applicable when a foreign holding company transfers its shares in an Indian company to another foreign company, as this transaction does not involve a payment from an Indian entity to a non-resident. However, if the transaction triggers indirect transfer provisions due to the substantial value derived from Indian assets, it could be subject to Indian capital gains tax. There are no specific case laws mentioned in the search results addressing this exact scenario.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

04 October 2025 Good luck...

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