CREDIT SUISSE (INTERNATIONAL) HOLDING AG BAHNHOFSTRASSE 17, 6300 ZUG SWITZERLAND, ADDRESS IN INDIA S.RULES BATLIBOI & CO., 6TH FLOOR, EXPRESS TOWERS, NARIMAN POINT, MUMBAI -400021 Vs. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION)

JUDGEMENT

(1.) THE applicant is a company incorporated under the laws of Switzerland and is a fully owned subsidiary of another company referred to as 'company C' hereinafter, incorporated in Switzerland. The applicant had set up a wholly owned subsidiary in India under the Indian Companies Act, 1956. For convenience, the Indian company is hence after referred to as 'I Co.' The applicant and its nominees together hold all the shares of I Co. The main business of the applicant is to acquire, hold, administer and have disposition over financial participation in other companies. 'Company C' and the applicant intend to merge into a single legal entity by means of a merger by absorption pursuant to Article 3 paragraph 1a of the Swiss Merger Act. Thereby, all the assets and liabilities of the applicant would be assumed by 'company C' and the applicant would be dissolved without liquidation. No consideration would pass to the applicant consequent on the merger in view of Article 8 of the Swiss Merger Act.

(2.) THE applicant approached the Authority with this application under section 245Q of the Income -tax Act seeking advance rulings on the questions raised by it in the context of the above merger. After hearing both sides, while reserving the question for consideration whether any scheme for avoidance of tax was involved, this Authority allowed the application under section 245R(2) of the Act to render Rulings on the following questions:

(3.) IF answer to question 1 is in the affirmative and answer 2 is in the negative, whether there is any requirement on Credit Suisse AG to withhold taxes in accordance with the provisions of section 195 of the Act?