Supreme Court Denies Tax Exemption to Tiger Global, Reshaping India's Tax Landscape

• The Supreme Court denied capital gains tax exemption to Mauritius-based Tiger Global International Holdings, ruling against treaty benefits under the India-Mauritius DTAA.
• The decision signals India's assertive stance against perceived treaty abuse and conduit structures, especially post-GAAR introduction.
• The Court held that indirect transfers are not protected under Article 13(4) of the DTAA, and a Tax Residency Certificate (TRC) alone is insufficient for treaty benefits.
• Grandfathering for pre-2017 investments is diluted; GAAR can apply to historical investments if tax benefits occur post-2017, expanding its applicability.
• The ruling emphasizes substance over form, judicial anti-abuse doctrines, and views double non-taxation as a red flag, increasing scrutiny for foreign investors.

Why It Matters: The Supreme Court's Tiger Global ruling significantly enhances India's power to tax offshore assets deriving value from India, demanding greater substance from foreign investors.