NASSCOM lauds SC judgement on Morgan Stanley case

New Delhi, July 10 (UNI) IT industry body NASSCOM today said the ruling delivered by the Supreme Court in the matter of Morgan Stanley case, as a very positive ruling for the BPO sector, as it settles significant taxation issues.

It settles significant issues of principles in taxing the foreign entities who outsource their activities to their captive Indian Companies, said a NASSCOM statement.

The judgment and overall principles affirmed by the Court yesterday will provide reassurance to multi-national companies with regard to the operation of their captive BPOs in India.

It has also served to clear the unnecessary uncertainty on some of the taxation issues, the statement said.

NASSCOM has suggested to the Ministry of Finance to consider creating an Advance Pricing Mechanism procedure saying it would allow taxpayers to disclose all relevant facts to tax authorities and obtain a binding ruling on the tax consequences.

UNI