GAAR will be effective April 1, 2017, onwards: CBDT

GAAR will not interplay with right of taxpayer to choose method of transaction

Addressing investors' concerns ahead of GAAR implementation from April 1, the tax department today said it will not interplay with their right to choose a method of transaction and won't apply if routing of funds through a jurisdiction is "based on non-tax commercial considerations".

The General Anti-Avoidance Rules (GAAR), which seek to prevent companies from routing transactions through other countries to avoid taxes, can be invoked through a two-stage process involving a nod at the level of principal commissioner of income tax and a panel headed by a high court judge.

Seeking to assuage concerns of investors, CBDT said GAAR provisions shall be effective