Business connection exemption for foreign investment funds: fund manager presence in India not treated as business connection if conditions met.

Section 9A exempts fund management activity performed in India by an eligible fund manager from constituting a business connection of the foreign fund and prevents such presence from making the fund resident in India. It sets eligibility criteria for funds (non residence, DTAA residence, investor concentration and corpus thresholds, diversification limits, investor protection, and prescribed remuneration) and for managers (registration, independence from the fund, ordinary course of business, and profit share cap). Funds must file an annual Form No.3CEK and face a statutory penalty for non compliance.

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