Supreme Court Rules Against Tiger Global in Landmark Tax Case

Got story updates? Submit your updates here. ›

In a landmark decision, the Supreme Court of India has ruled against three Mauritius-incorporated investment entities of the Tiger Global group, rejecting their claim for exemption from Indian capital gains tax on the sale of shares in a Singapore company whose value was substantially derived from Indian assets. The Court held that the structure constituted an impermissible tax avoidance arrangement under India's General Anti-Avoidance Rules (GAAR), despite the entities holding valid tax residency certificates from Mauritius.

Why it matters

The ruling reflects a stricter and more expansive application of GAAR and unsettles several long-standing principles relating to treaty eligibility, the evidentiary value of Tax Residency Certificates (TRCs), and the continuing relevance of administrative circulars and earlier Supreme Court precedents. The decision is expected to have significant implications for foreign investors, particularly those investing into India through special purpose vehicles (SPVs) in treaty-favoured jurisdictions such as Mauritius and Singapore.

The details

The three Mauritius-incorporated investment entities (the 'MauritiusCos') were established with the stated objective of undertaking investment activities and generating long-term capital appreciation. They held Category 1 Global Business Licences in Mauritius, were regulated by the Mauritius Financial Services Commission, and maintained a presence in Mauritius. Between 2011 and 2015, the MauritiusCos acquired shares in Flipkart Singapore, a Singapore-incorporated holding company whose value was substantially derived from Indian assets. In 2018, as part of Walmart's acquisition of Flipkart, the MauritiusCos sold their shares in Flipkart Singapore. The MauritiusCos sought a nil withholding tax certificate from the Indian tax authorities, contending that the capital gains were exempt under the India–Mauritius Double Tax Agreement (DTA). However, the Indian tax authorities denied the request and directed the buyer to withhold tax, citing India's indirect transfer provisions under domestic law.

• In May 2018, the MauritiusCos sold their shares in Flipkart Singapore to a Luxembourg entity.
• On 15 January 2026, the Supreme Court of India delivered its judgment, overturning the High Court's earlier ruling and upholding the Authority for Advance Rulings' (AAR) decision.

What’s next

The Indian tax authorities are expected to intensify scrutiny of governance, control, and commercial substance for foreign investors using SPVs in low-tax jurisdictions. Existing disputes involving indirect transfers or treaty claims may also be materially affected by this precedent.