老虎環球在與沃爾瑪-Flipkart交易相關的印度稅務案中敗訴，重創其離岸操作模式

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Tiger Global loses India tax case tied to Walmart-Flipkart deal in blow to offshore playbook

India’s top court has ruled against Tiger Global in a tax case stemming from its Flipkart exit during Walmart’s 2018 takeover, a decision that strengthens New Delhi’s ability to challenge offshore treaty structures and could raise tax risk for global funds counting on predictable exits from one of the world’s fastest-growing major markets.

On Thursday, the Indian Supreme Court backed the tax authorities in a dispute over whether Tiger Global could use its Mauritius-based entities to claim protection under the India–Mauritius tax treaty and avoid paying capital gains tax in India on profits linked to its exit in the Walmart–Flipkart deal. The decision set aside a 2024 Delhi High Court ruling that had overturned a 2020 order by the Authority for Advance Rulings, which had found the firm was, prima facie, avoiding tax and therefore not eligible for treaty relief.

The ruling is being closely watched by investors, as it strengthens India’s hand in challenging offshore “treaty-routing” structures that have long been used to reduce tax on high-value exits. It could also raise uncertainty over how future cross-border deals are structured and priced, at a time when foreign funds are counting on India as a key growth market.

In its verdict, a two-judge bench said (PDF) that when a transaction appears, at first glance, to be designed to avoid income tax, India’s advance-ruling mechanism cannot be used to seek protection.

Tiger Global first invested in India’s e-commerce firm Flipkart in 2009 with an initial $9 million investment, before increasing its exposure to about $1.2 billion over multiple funding rounds, TechCrunch had reported earlier. The firm later sold its stake to Walmart for about $1.4 billion in 2018.

The tax dispute centers on how Tiger Global structured that investment — through entities in Mauritius — and whether those vehicles could claim protection under the India–Mauritius tax treaty to shield capital gains from Indian tax.

While selling Flipkart’s stake during Walmart’s $16 billion deal, Tiger Global sought a certificate allowing no tax to be withheld, arguing that because the shares were acquired before April 1, 2017, the gains were exempt from Indian capital gains tax under a “grandfathering” clause, protecting older investments from the newer tax regime, in the India–Mauritius double taxation avoidance agreement. Indian tax authorities rejected the request in 2020, questioning the offshore structure chosen by the investment firm.

The Supreme Court bench framed the dispute as an issue of sovereign taxing powers, warning against structures that are designed primarily to dilute that authority.

“Taxing an income arising out of its own country is an inherent sovereign right of that country,” the bench said, adding that “any dilution of this power through artificial arrangements is a direct threat to its sovereignty and long-term national interest.”

The judgment should be read as a caution against aggressive tax planning rather than a wholesale dismantling of the India–Mauritius treaty framework, Ajay Rotti, a tax expert and founder and CEO of tax advisory firm Tax Compass, wrote on X. He said the decision reinforces a broader shift toward “substance over form”, signalling treaty protection may not apply automatically where offshore entities lack real commercial activity.

Tiger Global did not respond to a request for comment.

The firm can seek a review of the verdict, though such petitions are rarely successful.