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Emerging Trends in Cross-Border Mergers and Their Tax Implications in India: A Critical Appraisal

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The Indian economy has seen steady and sustainable growth over the past decade, even though other countries have been cash-strapped and suffering from stagnation. Most of this development is due to the inflow of foreign direct investment (FDI) into India through cross-border mergers and acquisitions (M&A) and the unparalleled rise in the size and number of cross-border M&A in India with a favourable market climate for such trade. As a business strategy, cross-border M&As in India are rife with many legal complexities and issues. This paper documents the steady growth of cross-border M&A activity in India over the years and presents a comprehensive depiction of cross-border M&As, what the applicable laws are, what the legal issues and complexities involved are, and finally how they can be offset. The paper highlights the tax implications and issues involved in a cross-border M&A and how far the Income Tax Act, 1961 is attuned with the corporate laws in force to promote cross-border M&As in India. The paper concludes with a broader observation that cross-border M&As bring massive economic benefits and global stature to a growing economic superpower like India. For this reason, the business and legal environment should be made more conducive to cross-border M&A activity.

About the Authors

A. Tiwari
Indian Institute of Technology Kharagpur

Avin Tiwari – UGC SRF (Law), Ph.D. Scholar, Rajiv Gandhi School of Intellectual Property Law

Kharagpur, West Bengal, 721302

G. Shukla
University of the South Pacific

Gaurav Shukla – Lecturer in Law, School of Law and Social Sciences (SoLaSS)

Suva, 1168


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For citation:

Tiwari A., Shukla G. Emerging Trends in Cross-Border Mergers and Their Tax Implications in India: A Critical Appraisal. BRICS Law Journal. 2021;8(1):116-134.

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ISSN 2409-9058 (Print)
ISSN 2412-2343 (Online)