Global investors against use of judicial anti-avoidance rule by tax officials
Economic Times 1 hr ago·18 Oct 2026, 5:47 pm
Global investors have raised concerns with Indian tax authorities regarding the use of the judicial anti-avoidance rule, or JAAR. This rule allows tax officials to deny relief on certain transactions, including grandfathered shares, which were issued before the rule's introduction. Investors argue that applying JAAR to these pre-existing shares contradicts prior regulations and creates uncertainty.
This issue matters to investors because it highlights the complex and evolving nature of India's tax laws. The Supreme Court has previously ruled on the application of the General Anti-Avoidance Rule, or GAAR, leaving the legal standing of JAAR in a grey area. This ambiguity can make it difficult for investors to plan their investments and understand their tax liabilities.
Investors should watch for further clarification from the Central Board of Direct Taxes and any potential judicial rulings. A clearer legal framework would help reduce uncertainty and improve the investment climate.
Excerpt from Economic Times
International investors have raised concerns regarding the Indian Income-tax authorities' invocation of the judicial anti-avoidance rule. At a recent meeting, investors communicated their issues with the Central Board of Direct Taxes on this matter. The use of JAAR to deny relief on grandfathered shares contradicts…Read the original at Economic Times
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