Section 9A(5)

Section 9A(5) — the law in short

What the courts have decided on section 9A(5), in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.

• Statutory position — rule 10V: the look-through for institutional investors, the cure periods that save a breach, and the twenty-six per cent control test CBDT Circulars & InstructionsCuts both ways
  My offshore fund breached one of the section 9A(3) conditions for part of the year, and one of its investors is itself a pooling vehicle. Is the safe harbour lost for the whole year?
  Not necessarily. Rule 10V(3) provides that a fund shall not be denied the benefit of being an eligible fund where non-fulfilment of conditions (c), (d) or (e) of section 9A(3) is for reasons beyond the fund's control and does not exceed ninety days, or does not exceed eighteen months from the date the fund is set up or the final closing of the fund, whichever is earlier, where bona fide efforts are made, or arises because the fund is being wound up and does not exceed one year from the date the winding-up process began; and it gives the same protection where the delay in furnishing the section 9A(5) statement does not exceed ninety days. Rule 10V(1) separately requires a look-through where the investment has been made directly by an institutional entity, and rule 10V(4) fixes the point at which the fund is said to control or manage a business in India for condition (k) at a holding exceeding twenty-six per cent.
• Statutory position — section 9A(5) and rule 10VB: the fund's annual statement in Form 3CEK, due ninety days after the financial year CBDT Circulars & InstructionsCuts both ways
  The offshore fund I advise has no Indian income and files no return here. Does it still have to file anything because it uses an Indian fund manager?
  Yes. Section 9A(5) requires every eligible investment fund, in respect of its activities in a financial year, to furnish within ninety days from the end of that financial year a statement in the prescribed form to the prescribed income-tax authority, containing information relating to the fulfilment of the conditions specified in section 9A and such other relevant information or documents as may be prescribed. Rule 10VB prescribes Form No. 3CEK, to be furnished electronically under digital signature to the Assessing Officer who has jurisdiction over the fund, or who would have had jurisdiction had the fund been assessable to tax in India but for section 9A.

Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.