Tax on foreign compnay

[MITSUI PRIME ADVANCED]

Dear sir,

I come to know weither our copany in india Register company act 1956 but 75% share held with foreign company, japan

please tell me this company treated under income tax as s foreign company tax will be 40% (50%) ?? or not

Regards

Arjun Sachdeva

 

[DR.MARIAPPAN GOVINDARAJAN]

Section 2(23A) of the Income Tax Act, 1961 defines the term 'foreign company' as a company which is not a domestic company i.e., company registered under Companies Act, 1956 or Companies Act, 2013. As such in my opinion your company will not be treated as foreign company.

AI Summary

Foreign company status under income tax depends on incorporation; Indian-registered firms are not treated as foreign companies. A company registered under the Companies Act, 1956 or 2013 is a domestic company; foreign company means a company not so registered. Therefore an Indian-registered company with majority foreign shareholding is not treated as a foreign company for income-tax purposes.