Suggested amendments to the tax provisions for Real Estate Sector 13 April 2020
Business Trusts may invest in a number of Holding companies/ SPVs and it is likely that there may be surplus funds available in one Holding company/ SPV which can be productively lent to another Holding company/ SPV. Considering provisions of Section 2(22)(e), such loans may have adverse tax implications. Provisions of Section 2(22)(e) do not apply to a listed company or its subsidiary. Since units of a Business Trust shall be listed and the Holding company/ SPV is its subsidiary, exemption from Section 2(22)(e) should be available to such Holding companies/ SPVs as they are available to a listed company or its subsidiary.
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