Foreign investors get tax compliance relief for AIF investment in IFSC

The Income Tax Department has exempted foreign entities who invest in AIFs operating in IFSC, from obtaining PAN subject to certain conditions.

Alternative Investment Fund (AIF) refers to any fund established or incorporated in India which is a privately pooled investment vehicle that collects funds from sophisticated investors, whether Indian or foreign.

The Central Board of Direct Taxes (CBDT) has inserted a new Rule 114AAB notifying class or classes of persons to whom provisions of Section 139A of Income Tax Act for mandatory obtaining PAN shall not apply.

It specified that the provisions shall not apply to a non-resident if the non-resident does