The Central Board of Direct Taxes (CBDT) has specified the sovereign wealth fund, Norges Bank On Account Of The Government Pension Fund Global as the specified person for the purposes of the said clause in respect of the investment made by it in India.
As per the notification issued on Friday, the exemption shall be granted subject to the following conditions;(i) the assessee shall file return of income, for all the relevant previous years falling within the period beginning from the date on which the said investment has been made and ending on the date on which such investment is liquidated, on or before the due date specified for furnishing the return of income under sub-section (1) of section 139 of the Act; (ii) the assessee shall get its books of account audited for the previous years referred to in clause (i) by an accountant specified in the Explanation below sub-section (2) of section 288 of the Act and furnish the Audit Report in the format annexed as Annexure to this notification herewith at least one month prior to the due date specified for furnishing the return of income under sub-section (1) of section 139 of the Act; (iii) the assessee shall furnish a quarterly statement within one month from the end of each quarter electronically in Form II as annexed to Circular No 15 of 2020, dated the 22nd July, 2020 with F. No. 370142/26/2020-TPL, issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes (Tax Policy and Legislation Division), in respect of each investment made by it during the said quarter; (iv) the assessee shall maintain a segmented account of income and expenditure in respect of such investment which qualifies for exemption under clause (23FE) of section 10 of the Act; (v) the assessee shall continue to be owned and controlled, directly or indirectly, by the Government of Norway, and at no point of time should any other person have any ownership or control, directly or indirectly, in the assessee; (vi) the assessee shall continue to be regulated under the laws of the Government of Norway; (vii) the earnings of the assessee shall be credited either to the account of the Government of Norway or to any other account designated by that Government so that no portion of the earnings inures any benefit to any private person, barring any payment made to creditors or depositors for loan taken or borrowing [as defined in sub-clause (a) of clause (ii) of Explanation 2 to clause (23FE) of section 10 of the Act] made for purposes other than for making investment in India; (viii) the assessee shall not have any loan or borrowing [as defined in sub-clause (a) of clause (ii) of Explanation 2 to clause (23FE) of section 10 of the Act], directly or indirectly, for the purposes of making investment in India; (ix) the asset of the assessee shall vest in the Government of Norway upon dissolution, barring any payment made to creditors or depositors for loan taken or borrowing for purposes other than for making investment in India; and (x) the assessee shall not participate in the day-to-day operations of investee (as defined in clause (i) of Explanation 2 to clause (23FE) of section 10 of the Act), but any monitoring mechanism to protect the investment with the investee, including the right to appoint directors or executive director, shall not be considered as participation in the day-to-day operations of the investee.
Section 10(23FE) of the Income-tax Act provides that income in the nature of dividend, interest, or long-term capital gains of a wholly-owned subsidiary of the Abu Dhabi Investment Authority or a sovereign wealth fund or a pension fund (herein called specified person) shall be exempt from tax.
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to TaxscanPremium. Follow us on Telegram for quick updates.
