No TDS on transfer of assets from Air India to SPV

Air India

New Delhi, (Asian independent) In a bid to further sweeten the Air India sale offer, the government has decided to waive taxes on the transfer of assets from the national carrier to Air India Assets Holding Limited, a special purpose vehicle (SPV).

“The Central Government hereby specifies that no deduction of tax shall be made under section 194-IA of the said Act on any payment made to the Air India Ltd for transfer of immovable property to Air India Assets Holding Ltd under a plan approved by the Central Government,” said a notification.

The Central Board of Direct Taxes (CDBT) has come up with a set of notifications, announcing the decision.

One notification from the said that Air India Assets Holding Ltd shall not be considered as ‘buyer’ for the purpose of sub-section (1) of section 194Q of the said Act in case of transfer of goods by Air India Ltd to it.

“The Central Government hereby specifies that Air India Ltd shall not be considered as ‘seller’ for the purposes of sub-section (1H) of section 206C of the said Act in relation to transfer of goods by it to Air India Assets Holding Ltd under a plan approved by the Central Government,” said another notification.

Last week, the CBDT also allowed new owners of erstwhile public sector companies to carry forward losses and set these off against future profits, in a bid to raise more interest for the proposed privatisation processes.

During the Budget speech for FY22, Finance Minister Nirmala Sitharaman had said that all the proposed privatisation process would be completed by the end of the fiscal, including the much-delayed strategic disinvestment of Air India.