Into the tax net: Pooled fund not service providing entity, says IVCA

Specific to AIFs, the IVCA said the funds are a mere pooling vehicle and not a service providing entity

Indian Private Equity & Venture Capital Association (IVCA) has written to the government saying a recent ruling by a Bengaluru-based tribunal pertaining to venture capital funds has created substantial confusion within the domestic fund industry and among limited partners, or LPs.
 
Last month, the Customs, Excise and Service Tax Appellate Tribunal, Bengaluru, had held that since trusts were treated as juridical persons for the purpose of Securities and Exchange Board of India (Sebi) regulations, there was no reason why they should not be treated as such for the purpose of taxation.
 
Going by the ruling, trusts could be