New Delhi: In an order to facilitate strategic disinvestment of Air India, the Centre has exempted taxes on transfer of assets by the national carrier to special purpose vehicle (SPV) Air India Assets Holding Ltd.
In a set of notifications, the Central Board of Direct Taxes (CBDT) said that there won’t be any tax deductible at source (TDS) cut in case of transfer of goods by the national carrier to the SPV. It further added that no TDS would be deducted under section 194-IA of I-T Act in case of transfer of immovable property by Air India to the SPV.
The CBDT also said that Air India would not be considered as ‘seller’ for the purposes of deduction of TCS for with regard to transfer of goods by it to AIAHL.
It said that transfer of capital asset under plan approved by central government from Air India Ltd to AIAHL would not be regarded as transfer for the purpose of income tax.
Last week, the CBDT had allowed new owners of erstwhile public sector companies to carry forward losses and set it off against future profits.
This is an effort towards making disinvestment deals of ailing state-owned firms more attractive for strategic investors.
The government is seeking to sell 100 per cent of its stake in the state-owned national airline, including Air India’s 100 per cent shareholding in AI Express Ltd and 50 per cent in Air India SATS Airport Services Pvt Ltd.
The strategic sale has reached the crucial phase with the September 15 being the last date for putting in financial bids by potential buyers.
The government wants to complete the long pending Air India strategic sale this fiscal. The disinvestment target for this fiscal has been set at ₹1.75 lakh crore.