Business Glossary

Ind-AS are Indian Accounting Standards converged with IFRS, mandatory for listed and unlisted companies with net worth above INR 250 crore.

A binding agreement between a taxpayer and tax authority that predetermines the transfer pricing methodology for international transactions over a fixed period.

The option to apply an advance pricing agreement's agreed transfer pricing method to up to four tax years before the agreement's own term begins, provided those years are still open for assessment.

A binding written determination by the Board for Advance Rulings on the tax consequences of a transaction involving non-residents or high-value resident transactions.

Quarterly tax installments due when liability exceeds INR 10,000; Form 168 is the consolidated statement of TDS, TCS, and tax credits linked to your PAN.

A CBIC-administered voluntary certification programme that grants trusted importers and exporters faster customs clearance, deferred duty payment, and reduced inspections.

AGILE-PRO-S (Form INC-35) is the SPICe+-linked form through which a new Indian company applies for GSTIN, EPFO and ESIC codes, profession tax, a bank account, and Shops & Establishment registration in one filing.

A privately pooled investment vehicle regulated by SEBI under the AIF Regulations, 2012, classified into three categories with a minimum investor commitment of INR 1 crore.

A tax on share premiums exceeding fair market value when unlisted companies issue shares, historically controversial for startups raising early-stage funding.

A mandatory yearly meeting of company shareholders required under the Companies Act 2013 to approve accounts and appoint auditors.

The Annual Performance Report (APR) is the yearly return an Indian resident entity files with the RBI, through its AD bank, for each foreign entity it holds under India's Overseas Investment rules. It is due every year by 31 December.

A yearly filing with the MCA containing details of shareholders, directors, debt, and compliance status of an Indian company.

The yearly statement a non-resident's Indian liaison office must file with its Assessing Officer under section 505 of the Income-tax Act, 2025, describing the office's activities for the tax year.

India's AML framework under the Prevention of Money Laundering Act, 2002, requiring KYC, suspicious transaction reporting to FIU-IND, and compliance by all financial entities.

The MCA form used to file a company's audited financial statements, including balance sheet and profit and loss account, after the AGM.

An international certification that authenticates documents for use in countries that are members of the Hague Apostille Convention.

India's arbitration framework under the Arbitration and Conciliation Act, 1996 governs domestic disputes, international commercial arbitration, and foreign award enforcement.

The principle requiring related-party transactions to be priced as if conducted between independent parties, mandated by Section 161 of the Income-tax Act, 2025 (section 92 of the Income-tax Act, 1961) for international and specified domestic transactions.

Two alternative tests under Indian transfer pricing law: the 35th-to-65th percentile range of comparables under Rule 81 of the Income-tax Rules, 2026, and the tolerance percentage notified under section 165(3) of the Income-tax Act, 2025.

A legal document governing a company's internal management, director powers, share transfer rules, and meeting procedures under Section 5 of the Companies Act 2013.

A company in which another company holds at least 20% of total voting power, or controls or participates in its business decisions under an agreement, without being its subsidiary; includes joint venture companies.

An associated enterprise is one linked to another by 26%+ voting power, a loan covering 51%+ of assets, a 10%+ guarantee, board control, or commercial dependence under section 162 of the Income-tax Act, 2025.

The maximum amount of share capital a company is legally permitted to issue, as specified in its Memorandum of Association under Section 2(8) of the Companies Act 2013.

A bank licensed by the Reserve Bank of India to deal in foreign exchange and handle cross-border investment transactions.

The FDI entry channel where foreign investors can invest in Indian companies without prior government approval.

Beneficial ownership in India spans three legal contexts: AML/PMLA (identifying ultimate owners of clients), corporate law (SBO declarations under Section 90 of the Companies Act, 2013), and tax treaties (qualifying for reduced withholding rates).

An OECD/G20 initiative comprising 15 action plans to combat tax avoidance strategies that exploit gaps in international tax rules to shift profits to low-tax jurisdictions.

Bill of Entry (Section 46) is India's import declaration and Shipping Bill (Section 50) is the export declaration, both filed electronically via ICEGATE.

A mandatory product quality certification issued by the Bureau of Indian Standards for goods sold or imported into India under specified categories.

A formal meeting of a company's board of directors to discuss strategy, approve accounts, and pass resolutions under the Companies Act 2013.

An extension of a foreign parent company in India, permitted under FEMA regulations to carry out specific business activities.

Business connection is the domestic-law test — dependent-agent activity or significant economic presence under section 9(2)(c) and 9(9) — that taxes a non-resident's India-linked income even without a treaty permanent establishment.

FEMA classifies all foreign exchange transactions as either capital account (altering foreign assets/liabilities, restricted) or current account (all others, generally free).

Tax on profits from the sale or transfer of capital assets like shares, property, or business interests, with rates depending on holding period.

India's mandatory pre-merger notification regime requiring CCI approval when asset, turnover, or deal value thresholds are breached.

India's cybersecurity compliance framework under CERT-In Directions 2022, requiring 6-hour incident reporting, 180-day log retention, and VPN/cloud provider obligations.

An official document issued by the Registrar of Companies confirming a company's legal existence and assigning its Corporate Identity Number.

A Chartered Accountant (CA) is a member of the Institute of Chartered Accountants of India (ICAI), licensed under the Chartered Accountants Act, 1949 to audit accounts and certify statutory tax filings.

Form CHG-1 is filed with the Registrar of Companies to register a charge (mortgage, hypothecation, or pledge) an Indian company creates over its assets, within 30 days of creation.

India's unified insolvency framework under the IBC, 2016, with CIRP as its time-bound corporate resolution mechanism governed by NCLT and IBBI.

The Companies Act, 2013 (Act No. 18 of 2013) is India's principal company law, governing incorporation, governance, financial reporting, audit, and winding up, administered by the Ministry of Corporate Affairs.

A qualified professional responsible for ensuring a company's compliance with the Companies Act 2013, SEBI regulations, and other statutory requirements.

The legal process of closing a company in India, either by removing its name from the ROC register (strike-off) or through formal liquidation via the NCLT or IBC.

The Comparable Uncontrolled Price (CUP) method tests a related-party price against the price charged in a genuinely comparable transaction between unrelated parties, adjusted for material differences, under section 165 of the Income-tax Act, 2025.

India's antitrust regulator under the Competition Act, 2002, enforcing rules on anti-competitive agreements, abuse of dominance, and merger control for deals above specified thresholds.

A month-by-month schedule of all regulatory filing deadlines for Indian companies, covering MCA, Income Tax, GST, RBI, and other statutory obligations.

Preference shares that must convert into equity shares within a specified period, commonly used in FDI-funded startups and venture deals in India.

Reduced corporate tax rates of 22% (effective 25.17%) and 15% (effective 17.16%) for domestic companies that forgo specified exemptions and deductions.

A Construction and Installation Permanent Establishment arises when a building site, installation, or supervisory activity in India runs beyond the applicable DTAA's threshold — six months, or 120 days under the India-US treaty.

The 50-worker threshold at which a contractor must hold a licence and a principal employer must separately register under the Occupational Safety, Health and Working Conditions Code, 2020.

CFC rules tax domestic shareholders on undistributed income of foreign subsidiaries. India lacks classic CFC legislation, using POEM (Place of Effective Management) under Section 6 instead.

The legal process of changing a company's registration from one business structure to another — such as private to public, OPC to private, or company to LLP — under the Companies Act, 2013 and the LLP Act, 2008.

A debt instrument issued by a DPIIT-recognised Indian startup that converts into equity shares or is repaid within 10 years, with a minimum INR 25 lakh investment required from non-resident investors.

The direct tax levied on the net income of companies registered in India, with rates ranging from 15% to 30% depending on the chosen tax regime.

A government-notified index used to adjust the purchase price of assets for inflation when calculating long-term capital gains tax in India.

The Cost Plus Method is a transfer pricing method that finds the arm's length price by adding a comparable gross profit mark-up to the direct and indirect costs of supplying goods or services to an associated enterprise.

A Cross-Border Payment Aggregator (PA-CB) is an RBI-authorised entity processing online export and import payments between Indian merchants and overseas customers, under a ₹15-25 crore net worth ladder and ₹25 lakh transaction cap.

An OECD-developed global standard for automatic exchange of financial account information between tax authorities, implemented in India under section 508 of the Income-tax Act, 2025.

The shortfall when India's payments for imports, services and income sent abroad exceed its receipts in the balance of payments, reported quarterly by the RBI.

Taxes on goods imported into India under the Customs Act 1962, comprising BCD, IGST, and SWS, plus anti-dumping duties to protect domestic industry from unfairly priced imports.

A licensed intermediary authorised by CBIC to handle customs clearance of imported and exported goods on behalf of importers and exporters in India.

The rules fixing the assessable value of imported goods, including additions for royalties and scrutiny of related party imports.

Sector rules, not one statute, requiring payment, insurance and general ICT data to sit inside India. RBI's 2018 circular is strictest: the entire payment transaction data must be stored only in India, and data processed abroad deleted and returned.

A SEBI-registered scheduled bank, public financial institution, insurance company, or body corporate appointed under Section 71(5) of the Companies Act, 2013 to hold the security for a debenture issue and enforce the debenture holders' rights.

India permits 74% FDI via automatic route and 100% via government approval in defense manufacturing, subject to industrial licensing and security clearance.

An electronic account holding securities in dematerialized form via NSDL or CDSL, mandatory for all share transactions in listed Indian companies.

A Dependent Agent Permanent Establishment arises when someone in India habitually concludes contracts, holds a stock for delivery, or secures orders for a foreign enterprise under section 9(9).

A partner in an LLP who bears statutory compliance responsibility, must hold a DPIN, and is personally liable for penalties on the LLP's regulatory defaults.

India's apex authority for regulating and promoting foreign trade, responsible for administering the Foreign Trade Policy, issuing Import Export Codes, and granting export-import authorizations.

India's digital identity stack for business operations: Aadhaar-based KYC, DigiLocker document verification, and e-Sign/DSC for regulatory filings and contracts.

An electronic credential issued by a Certifying Authority that authenticates the identity of a person filing documents with MCA and other government portals.

The director KYC intimation that every Director Identification Number (DIN) holder must file in Form No. DIR-3 KYC Web on or before 30 June of the immediately following every third consecutive financial year, under Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2014 as substituted with effect from 31 March 2026.

A unique 8-digit number assigned by MCA to every individual appointed as a director of an Indian company under Section 153 of the Companies Act 2013.

The Dispute Resolution Panel is a three-commissioner collegium under section 275 of the Income-tax Act, 2025 (section 144C, 1961 Act) that reviews a draft assessment order before it is finalised.

Tax on dividend income distributed by Indian companies to shareholders, shifted from company-level DDT to shareholder-level taxation since April 2020.

A company that has been granted inactive status under Section 455 of the Companies Act, 2013, either because it has no significant accounting transactions or has not been carrying on business, allowing reduced compliance obligations for up to five consecutive years.

A bilateral treaty between India and another country that prevents the same income from being taxed in both jurisdictions.

Tax relief mechanisms under Indian law that prevent the same income from being taxed in both India and another country, available through DTAAs or unilateral provisions.

Investment by a foreign-owned or controlled Indian company (FOCC) in equity instruments of another Indian entity, treated at par with direct FDI.

India's comprehensive data privacy law governing digital personal data collection, processing, and transfer, with penalties up to INR 250 crore for non-compliance.

DPIIT recognition is the official certification issued by the Department for Promotion of Industry and Internal Trade that qualifies an Indian startup for tax holidays, angel tax exemption, IPR rebates, seed funding, and simplified compliance under the Startup India initiative.

DPT-3 is the annual return, due 30 June under rule 16 and rule 16A of the Companies (Acceptance of Deposits) Rules, 2014, reporting deposits and money received that the rules treat as not being a deposit.

A systematic investigation of a target company's legal, financial, tax, and operational affairs before an acquisition or investment, critical for foreign investors entering India given the country's layered regulatory environment.

A refund of customs duties paid on imported goods that are either re-exported or used as inputs in manufacturing goods for export from India.

India's FDI policy permits 100% foreign investment under the automatic route for marketplace e-commerce only, while prohibiting FDI in inventory-based e-commerce models except for exports of goods made or produced in India (Press Note 3 of 2026).

E-invoicing under GST is the Rule 48(4) requirement that notified taxpayers report B2B invoices to the Invoice Registration Portal and obtain an Invoice Reference Number (IRN) before the invoice is valid.

A six-month, multiple-entry Indian e-Visa category for foreign professionals an Indian company sponsors for installation, commissioning, maintenance, production, or training work, via a sponsorship letter generated on NSWS.

A mandatory electronic document required for transporting goods worth over INR 50,000 within India, generated on the GST portal before movement begins.

A loan raised by an Indian entity from a non-resident lender in foreign currency or INR, regulated by the RBI under FEMA guidelines.

EDPMS and IDPMS are the RBI systems through which Authorized Dealer banks track export proceeds and import payments — exporters must realise proceeds within nine months of export (also nine months from 1 October 2026, or twelve months for rupee-invoiced exports) and importers must settle within six months of shipment.

A non-interest-bearing current account that allows Indian residents earning foreign exchange to retain 100% of forex earnings without immediate INR conversion.

The process of getting a document authenticated by a country's embassy or consulate for legal use in that country.

India's mandatory retirement savings scheme under the EPF & Miscellaneous Provisions Act, 1952, requiring 12% contributions from both employer and employee on basic wages up to the INR 25,000 wage ceiling (raised from INR 15,000 on 17 September 2026).

A third-party organization that becomes the legal employer of your workforce in India, handling payroll, taxes, and labor compliance so you can hire without setting up a local entity.

India's primary financial enforcement agency under the Ministry of Finance, responsible for investigating FEMA contraventions and money laundering under PMLA.

A mandatory approval from MoEFCC or SEIAA required before establishing industrial, mining, or infrastructure projects in India, governed by the EIA Notification, 2006.

The regulatory framework requiring businesses in India to obtain environmental clearance, SPCB consents, and comply with pollution control laws before establishing or operating industrial facilities.

Two duty exemption schemes under India's Foreign Trade Policy: EPCG allows zero-duty import of capital goods with 6x export obligation; Advance Authorization permits duty-free import of inputs for export manufacturing.

A tax on digital transactions by non-residents in India — 6% on online advertising (2016–2025) and 2% on e-commerce (2020–2024) — now fully abolished.

A secure third-party bank account that holds funds or assets until predefined transaction conditions are met, widely mandated in Indian M&A, FDI, real estate, and takeover transactions.

India's mandatory ESG disclosure framework requiring the top 1,000 listed companies to file Business Responsibility and Sustainability Reports under SEBI LODR Regulations.

A social security scheme under the Code on Social Security, 2020 (formerly the ESI Act, 1948) providing medical, sickness, maternity, and disability benefits to employees earning up to INR 21,000 per month in India.

A mechanism under Section 62(1)(b) of the Companies Act, 2013, allowing companies to grant employees the right to purchase shares at a predetermined price after a vesting period.

A supply of services is treated as an export and zero-rated under GST only if it meets all five conditions in section 2(6) of the IGST Act, 2017, including receipt of payment in convertible foreign exchange.

Extended Producer Responsibility (EPR) is the legal duty on producers, importers and brand owners to collect and recycle a rising share of the plastic packaging, e-waste, batteries or tyres they place on the Indian market.

The Factories Act 1948 regulates safety and welfare in manufacturing establishments; RERA 2016 protects buyers and regulates real estate projects.

US federal laws requiring US persons to report foreign financial accounts (FBAR/FinCEN 114) and foreign financial institutions to report US account holders to the IRS (FATCA).

Form FC-1 is the MCA e-form that a foreign company must file with the Registrar of Companies within 30 days of establishing a place of business in India, such as a Branch Office, Liaison Office, or Project Office, under Section 380 of the Companies Act, 2013.

Mandatory RBI form filed when an Indian company issues shares or convertible instruments to a foreign investor.

A foreign currency fixed deposit account for NRIs that eliminates exchange rate risk and offers tax-free interest in India.

Foreign investment into an Indian LLP is allowed only under the automatic route, only in sectors with 100% FDI under the automatic route, and only where no FDI-linked performance conditions apply.

Maximum percentages of foreign equity permitted in specific Indian industries, prescribed under DPIIT's Consolidated FDI Policy and enforced through FEMA, ranging from 0% (prohibited sectors) to 100% (fully open sectors).

Payments for managerial, technical or consultancy services, taxed in India at statutory or treaty rates on the gross amount.

Section 428 of the Income-tax Act, 2025, as substituted by the Finance Act 2026, charges flat fees for late returns, tax audit defaults (INR 75,000-INR 1,50,000), and missed transfer pricing reports (INR 50,000-INR 1,00,000), from 1 April 2026.

A voluntary mechanism under FEMA allowing persons who commit foreign exchange contraventions to admit the violation and pay a compounding amount to the RBI, avoiding lengthy adjudication proceedings.

The Single Master Form is a consolidated RBI reporting form that replaced nine separate FDI reporting forms, filed on the FIRMS (Foreign Investment Reporting and Management System) online portal for all foreign investment transactions in India.

The annual amending Act that revised sections of the Income-tax Act, 2025 before its 1 April 2026 commencement.

A document issued by an Authorized Dealer bank in India confirming receipt of foreign currency remittance from abroad, serving as proof of foreign investment or export proceeds.

A Fixed Place Permanent Establishment arises when a foreign enterprise has a fixed, sufficiently permanent location in India through which its business is wholly or partly carried on, triggering Indian tax on profits attributable to it.

A mandatory annual return filed with the RBI by every Indian entity that has received FDI or made overseas investment, reporting the outstanding stock of foreign liabilities and assets as of 31 March each year.

An Indian company where non-residents beneficially own more than 50% equity or control management decisions, making its downstream investments subject to FDI rules.

The Force of Attraction Rule is a treaty provision that lets India tax a foreign enterprise's direct sales of similar goods or services once it has a permanent establishment there, even if those sales bypass the PE.

A company incorporated outside India that establishes a place of business in India, governed by Chapter XXII (Sections 379-393) of the Companies Act, 2013.

Investment by a foreign entity into an Indian business, granting ownership stake and management control under FEMA regulations.

India's primary law governing foreign exchange transactions, cross-border investments, and overseas remittances since 1999.

FPIs invest in listed Indian securities under SEBI FPI Regulations 2019; FVCIs invest in unlisted venture capital under SEBI FVCI Regulations 2000, with pricing and lock-in exemptions.

The credit an Indian resident sets off against Indian tax for tax already paid abroad on the same income, under a treaty or unilaterally, substantiated in Form 67.

India's master framework governing all imports and exports, effective April 2023 with no fixed expiry, targeting USD 2 trillion in exports by 2030 through schemes like RoDTEP, Advance Authorization, and EPCG.

Form 130 (formerly Form 16) is the annual certificate an Indian employer must issue to each employee showing salary paid and tax deducted at source, required under section 395(4)(a) of the Income-tax Act, 2025.

Form 144 (formerly Form 27Q) is the quarterly statement that reports tax deducted at source on payments made to non-resident payees, required under section 397(3)(b) of the Income-tax Act, 2025.

A TDS certificate issued by the deductor to the deductee for tax deducted at source on non-salary payments such as interest, rent, professional fees, and dividends.

A mandatory declaration filed by non-residents with the Indian Income Tax Department to claim DTAA benefits, providing the tax residency details required under section 159 of the Income-tax Act, 2025.

Form 48 (formerly Form 3CEB) is the chartered accountant's report on international and specified domestic transactions, prescribed by rule 85 of the Income-tax Rules, 2026 under section 172 of the Income-tax Act, 2025 and due 31 October, a month before the return.

Form CSR-2 is the annual report on Corporate Social Responsibility spending that every company covered under section 135 of the Companies Act, 2013 files with the Registrar of Companies, under Rule 12(1B) of the Companies (Accounts) Rules, 2014.

Form ECB-2 reports the receipt of External Commercial Borrowing (ECB) proceeds and debt servicing to the RBI, filed through the borrower's designated AD Category-I bank within seven calendar days from the end of the month in which either occurred.

FC-TRS is the RBI-prescribed reporting form under FEMA that must be filed within 60 days whenever shares or convertible debentures of an Indian company are transferred between a resident and a non-resident, submitted through the FIRMS portal via an Authorised Dealer Category I bank.

The FEMA return an Indian LLP files within thirty days of receiving capital contribution from a non-resident investor.

India offers three legal structures for non-profits — public charitable trust, society, and Section 8 company — each with different governance, compliance, and foreign funding implications.

Mandatory forms for reporting foreign remittances from India — Form 145 is the online declaration by the remitter, and Form 146 is a CA certificate verifying tax compliance.

Form FC-3 is the annual accounts a foreign company files within six months of its financial year end, and Form FC-4 is the annual return filed within sixty days of that year end, both with the Registrar of Companies.

A Free Trade Warehousing Zone is an SEZ category under section 2(n) of the SEZ Act, 2005, for trading and warehousing, where a foreign supplier's goods are held duty-free until cleared into India on payment of customs duty.

A mandatory license issued by the Food Safety and Standards Authority of India for any business involved in manufacturing, processing, distributing, selling, or importing food products.

FTAs are bilateral or regional trade pacts that reduce or eliminate customs duties; rules of origin determine which goods qualify for preferential tariff treatment.

Indian tax provisions under sections 178-184 of the Income-tax Act, 2025 that empower authorities to deny tax benefits from arrangements whose principal purpose is obtaining a tax advantage.

India's first International Financial Services Centre in Gujarat, offering a special tax and regulatory regime for global financial services, fund management, and fintech operations.

The structured movement of employees across borders — via secondment, local transfer, or intra-company transfer — each carrying distinct immigration, tax, FEMA, and social security obligations in India.

India's unified indirect tax on the supply of goods and services, replacing multiple state and central levies since July 1, 2017.

The FDI entry channel where foreign investors must obtain prior approval from the Indian government before investing.

A statutory retirement benefit payable to employees who complete 5 years of continuous service, calculated at 15 days' wages per year of service, capped at INR 20 lakh.

The process of obtaining a unique GSTIN from the GST portal, mandatory for businesses exceeding the turnover threshold or making inter-state supplies.

GSTR-9 is India's annual GST return, due 31 December, which taxpayers with aggregate turnover up to ₹2 crore are exempt from filing; GSTR-9C is the self-certified reconciliation statement required above ₹5 crore turnover under Rule 80.

An international treaty that simplifies document authentication between member countries by replacing embassy legalization with a single apostille certificate.

The Income-tax Act, 2025 rule that raises TDS or TCS to 20% (or the applicable rate, if higher) when a payee fails to furnish a valid Permanent Account Number to the deductor or collector.

A company that controls one or more subsidiary companies by holding more than 50% of their total share capital or controlling the composition of their board of directors, as defined under Section 2(46) of the Companies Act, 2013.

The numeric classification that fixes the customs duty, GST rate and import-licensing status of a product in India, carried as an eight-digit tariff item on customs documents.

Hypothecation is a charge over movable property that stays in the borrower's possession, defined in section 2(1)(n) of the SARFAESI Act, 2002, and registrable with the ROC within 30 days under section 77 of the Companies Act, 2013.

A 10-digit code issued by DGFT that is mandatory for any person or entity importing or exporting goods and services from India.

Act 13 of 2025, in force from 1 September 2025, is India's single law on foreigners' entry, stay, exit and registration, replacing the Foreigners Act, 1946 and three related statutes.

Cross-border mergers where either a foreign company merges into an Indian company (inbound) or an Indian company merges into a foreign company (outbound), governed by Section 234 of the Companies Act and RBI's FEMA Cross-Border Merger Regulations, 2018.

INC-20A is the declaration a company with share capital must file within 180 days of incorporation, confirming subscribers paid their share money, under section 10A of the Companies Act, 2013.

An annual filing with the Income Tax Department declaring a company's income, deductions, and tax liability for the assessment year.

India's rewritten income tax statute, Act 30 of 2025, in force from 1 April 2026 under section 1(3) and repealing the Income-tax Act, 1961, though section 536 keeps the 1961 Act alive for earlier tax years.

The CBDT rules under the Income-tax Act, 2025 that took effect on 1 April 2026, renumbering every income tax form and prescribing filing procedure for tax year 2026-27 onward.

The legal test separating an independent contractor on a services contract from an employee covered by India's labour and payroll law, decided chiefly by how much control the principal exercises over the work.

A non-executive director who meets strict independence criteria, mandatory for listed and qualifying public companies in India to ensure governance oversight.

India's 2016 Model Bilateral Investment Treaty replaced the earlier framework with restrictive provisions including enterprise-based investment definitions, a 5-year exhaustion of local remedies requirement, and limited investor-state dispute settlement.

A government initiative offering 50% fiscal support for semiconductor fabs, OSAT, and compound semiconductor facilities, with 10 approved projects totaling INR 1.6 trillion.

Four codes enacted in 2019-2020 that consolidate 29 central labour laws into a unified framework covering wages, social security, industrial relations, and workplace safety.

India's network of Comprehensive Economic Partnership Agreements (CEPA), Comprehensive Economic Cooperation Agreements (CECA), and Bilateral Investment Treaties (BIT) governing preferential trade and investment protections with partner nations.

Tax provisions deeming capital gains on offshore share transfers taxable in India when the shares derive substantial value from Indian assets.

A mandatory government permit under the Industries (Development and Regulation) Act, 1951 for manufacturing defense equipment, hazardous chemicals, explosives, and tobacco products in India.

The process by which a private company offers shares to the public for the first time through a listing on the NSE or BSE, governed by SEBI's ICDR Regulations, 2018.

An Input Service Distributor (ISD) is the GST registration an office must take under Section 20 of the CGST Act to distribute credit on common input services to a company's other GST registrations, pro rata by turnover under Rule 39.

ITC allows GST-registered businesses to reduce their output tax liability by the amount of GST already paid on business inputs, preventing cascading taxation.

Section 186 of the Companies Act, 2013 caps a company's loans, guarantees and investments in other body corporates at 60% of paid-up capital, free reserves and premium, or 100% of reserves and premium, whichever is higher.

A broker, agent, or facilitator under section 2(13) of the IGST Act, 2017 who arranges a supply between two other persons without supplying it on their own account. Its place-of-supply rule, section 13(8)(b), was omitted on 30 March 2026.

Global AML standards from FATF, sanctions screening obligations (UNSC, OFAC), and PEP identification requirements that shape how foreign companies operate in India.

The Madrid Protocol and PCT enable centralised international trademark and patent filings through WIPO, allowing applicants to protect IP across 130+ countries from a single application.

Mechanisms under DTAA Article 25 and the MLI that resolve cross-border tax disputes, prevent double taxation, and deny treaty abuse through the Principal Purpose Test.

An international transaction is a dealing between associated enterprises where at least one is a non-resident, covering goods, services, intangibles, financing, guarantees, and business restructuring, priced at arm's length under section 163.

A foreign national (or an Indian employee with foreign SSA-linked service) whose EPF contributions are computed on full monthly pay with no ₹25,000 wage ceiling, unless a Social Security Agreement and Certificate of Coverage exempt them.

India offers four primary IP registrations — trademarks, patents, copyrights, and designs — each governed by separate legislation and filed through the IP India portal.

The Jan Vishwas (Amendment of Provisions) Act, 2026 (Act No. 8 of 2026) replaces imprisonment and criminal fines with warnings and monetary penalties across 80 Central Acts, including the Legal Metrology Act, 2009.

A business arrangement where a foreign company and an Indian partner jointly own and operate a company registered in India.

Senior officers — Managing Director, CEO, CFO, Company Secretary, and Whole-time Directors — whose appointment is mandatory for listed and qualifying public companies under Section 203 of the Companies Act, 2013.

Mandatory identity verification process required by RBI, SEBI, and other Indian regulators before opening bank accounts, making investments, or incorporating companies in India.

The Late Submission Fee (LSF) is the RBI's fixed or formula-based charge for regularising delayed FEMA filings such as FC-GPR, FC-TRS and the annual FLA return, in place of formal compounding.

A unique 20-character alphanumeric code (ISO 17442) identifying legal entities in financial transactions, mandated by RBI for borrowers with exposure above INR 5 crore, OTC derivative participants, and government securities market participants in India.

Legal Metrology compliance is the package-declaration and importer-registration regime under section 18 of the Legal Metrology Act, 2009 and Rules 6/27 of its 2011 Rules that every pre-packaged retail good sold in India must meet.

The Letter of Undertaking (LUT) is the annual undertaking an exporter files in FORM GST RFD-11, under rule 96A of the CGST Rules, 2017, to export goods or services without paying integrated tax upfront.

A representative office of a foreign company in India that can only perform non-commercial liaison activities under RBI approval.

An RBI scheme allowing Indian residents to remit up to $250,000 per financial year abroad for investment, education, travel, and other permitted purposes.

A treaty provision in DTAAs that restricts tax benefits to residents who meet specific ownership, activity, or economic substance tests, preventing treaty shopping.

A hybrid business entity combining partnership flexibility with limited liability protection, governed by the LLP Act 2008.

The Loan Registration Number is the number the Reserve Bank of India allots, through the borrower's AD Category-I bank, to register an external commercial borrowing before any drawdown. No LRN means no legal drawdown.

Section 185 of the Companies Act, 2013 bars an Indian company from lending to, or guaranteeing a loan for, its directors and connected parties, subject to a special-resolution route and narrow statutory exemptions.

The contractual architecture of M&A transactions in India, covering share purchase vs asset purchase structures, representations and warranties, indemnification, earnouts, and regulatory conditions.

A DTAA condition taxing fees for technical services only if the service transfers skill, knowledge or a process the recipient can apply independently; India's domestic definition under section 9(7) of the Income-tax Act, 2025 has no such condition.

A foundational legal document defining a company's name, registered office, objects, liability, and capital structure under Section 4 of the Companies Act 2013.

A minimum tax on company book profits — 14% from tax year 2026-27, 15% for FY 2025-26 and earlier — payable when tax under normal provisions falls below that floor.

The Minimum Average Maturity Period (MAMP) is the shortest weighted average tenor an External Commercial Borrowing may carry under RBI rules — three years for most borrowers, one to three years for manufacturers, since 16 February 2026.

MOOWR lets a licensed bonded warehouse import inputs and capital goods with customs duty deferred, indefinitely and interest-free, payable only if goods are cleared into India rather than exported.

An MFN clause is a treaty protocol provision that imports a lower rate or narrower scope India later grants another OECD state, but after the 2023 Nestle ruling it applies only once CBDT issues a fresh section 159 (section 90) notification.

A free, Aadhaar-based online registration under the MSMED Act, 2006 that classifies enterprises as Micro, Small, or Medium based on investment and turnover criteria, unlocking priority lending, subsidies, and delayed payment protection.

The half-yearly return companies file reporting payments to micro and small enterprise suppliers outstanding beyond forty-five days, required under Section 405 of the Companies Act, 2013.

FDI policy permitting up to 51% foreign investment in retail sale of multiple brands, requiring government approval and subject to stringent conditions including a USD 100 million minimum investment.

India's dedicated company law tribunals handling insolvency (IBC), mergers, oppression disputes, and winding up, replacing the former Company Law Board since June 2016.

Court-supervised corporate restructuring under the Companies Act, 2013 enabling amalgamations, demergers, and capital reorganisations through NCLT-sanctioned schemes.

A certificate under section 395 of the Income-tax Act, 2025 (section 197 of the Income-tax Act, 1961) that lets a payee ask the Assessing Officer to have an Indian payer deduct tax at a reduced rate, or not at all, instead of the standard TDS rate.

A director appointed to an Indian company's board by an investor, lender, or institution under Section 161(3) of the Companies Act, 2013 — legally bound to act in the company's interest, not the nominator's.

A company registered with the RBI that provides financial services like lending, investment, and insurance without holding a banking licence.

Central Government rules under FEMA governing all foreign equity investment in India — covering FDI, FPI, NRI/OCI investments, LLP capital, and venture capital.

A treaty article barring India from taxing a foreign enterprise's Indian branch more heavily than a comparable domestic company, subject to a specific reservation for the foreign-company tax rate.

Correspondent banking accounts enabling cross-border payments: Nostro (our account abroad), Vostro (their account with us), and SRVA (INR trade settlement accounts under RBI's 2022 framework).

A rupee-denominated bank account for NRIs that allows free repatriation of both principal and interest to the account holder's country of residence.

An Indian citizen or Person of Indian Origin who resides outside India for more than 182 days in a financial year.

A rupee-denominated bank account for NRIs to manage income earned in India, with limited repatriation of up to $1 million per financial year.

A person who occasionally supplies goods or services in India without a fixed place of business, requiring mandatory GST registration regardless of turnover.

A registration status granted to foreign citizens of Indian origin that provides a lifelong visa and the right to work and invest in India.

Investment made by an Indian resident entity or individual in a foreign entity by way of equity capital, loan, or guarantee, regulated by the RBI under FEMA's Overseas Investment framework.

The OECD/G20 Inclusive Framework's two-pillar solution: Pillar One reallocates taxing rights to market jurisdictions; Pillar Two imposes a 15% global minimum tax on MNEs with revenue above EUR 750 million.

Online information and database access or retrieval (OIDAR) services are internet-delivered digital services sold into India by an overseas supplier, who must register in India and pay GST directly on sales to any unregistered Indian recipient.

A company with a single member and limited liability, introduced under Section 2(62) of the Companies Act 2013.

OPI is a resident's investment in foreign securities that is not ODI: under 10% of a listed foreign entity's equity and no control. An Indian entity's OPI is capped at 50% of its net worth.

The actual amount of money shareholders have paid to the company for their shares, representing real funds received by the company under Section 2(64) of the Companies Act 2013.

A tax regime that exempts dividends and capital gains received by a parent company from its subsidiaries — widely available globally but largely absent in India.

A business structure under the Indian Partnership Act, 1932, where two or more persons agree to share profits and losses of a business carried on by all or any of them acting for all.

PAS-3 is the return an Indian company must file with the Registrar of Companies within 30 days of allotting shares or other securities — or within 15 days for a private placement — under Sections 39(4) and 42(8) of the Companies Act, 2013.

India's payment infrastructure governed by the Payment and Settlement Systems Act, 2007 — covering RTGS, NEFT, UPI for domestic transfers and SWIFT for international remittances.

A unique 10-character alphanumeric identifier issued by the Income Tax Department to individuals and entities for tracking tax-related transactions in India.

A fixed place of business in India through which a foreign enterprise carries on its operations, triggering Indian tax liability on business profits.

India's FDI policy for pharmaceuticals permits 100% FDI in greenfield projects under automatic route and up to 74% in brownfield under automatic route, with above 74% requiring government approval.

The IGST Act rules deciding where a supply of goods or services is deemed to occur — usually the recipient's location for cross-border services under section 13(2) — fixing whether it is intra-state, inter-state, an import, or an export.

A Government of India scheme offering financial incentives (4-6% of incremental sales) to manufacturers in 14 key sectors to boost domestic production and attract foreign investment.

POSH Act compliance requires every Indian workplace with ten or more workers to constitute an Internal Committee under section 4 of the 2013 Act, and confirm it annually in the company's Board's report.

The treaty carve-out keeping storage, display, purchasing and information gathering in India from creating a permanent establishment.

A DPIIT press note of 2020 putting FDI from countries sharing a land border with India, or beneficially owned from them, on the government approval route; since 2 May 2026 a defined beneficial-ownership threshold applies.

FEMA rules that require shares issued to or transferred from non-residents to be priced at or above the fair market value (floor price for inward FDI, ceiling price for outward transfers), determined using internationally accepted valuation methodologies.

A business entity registered under the Companies Act 2013 with limited liability protection and restricted share transferability.

Private placement is the Section 42 (Companies Act, 2013) route for offering securities to a select group of up to two hundred identified persons in a financial year, using a Form PAS-4 offer letter.

A state-level employment tax in India levied on salaried employees and professionals, with rates varying by state up to a constitutional maximum of INR 2,500 per year.

Profit attribution decides how much of a foreign enterprise's worldwide profit is taxable in India once it has a permanent establishment here, applying DTAA Article 7 and Rule 10 of the Income-tax Rules.

The Profit Split Method (PSM) divides the combined profit from an integrated cross-border transaction between related enterprises by their relative contribution, under section 165 of the Income-tax Act, 2025 (section 92C of the 1961 Act).

A temporary office established by a foreign company in India to execute a specific project, approved by RBI under FEMA regulations.

A person who controls a company's affairs, is named as promoter in filings, or whose directions the board follows — carrying fiduciary duties and personal liability.

An annual tax levied by municipal corporations on commercial real property in India, calculated using ARV, Capital Value, or Unit Area methods depending on the city.

A company that can offer shares to the general public, requiring minimum 7 members and 3 directors under the Companies Act 2013.

A Quality Control Order (QCO) is a Central Government notification under section 16 of the Bureau of Indian Standards Act, 2016 that makes BIS certification compulsory for a named product, barring its manufacture, import or sale in India without it.

RBI's consolidated regulatory document governing all foreign equity investments in India under FEMA, covering FDI, FPI, downstream investments, pricing, and reporting.

India's regulatory framework for outbound investments by Indian entities, distinguishing automatic route (up to 400% of net worth) from RBI prior approval route, with Form ODI and APR reporting requirements.

The official address of a company filed with the Registrar of Companies, used for all government communications and legal notices under Section 12 of the Companies Act 2013.

A Registered Valuer is a professional registered with the IBBI under Section 247 of the Companies Act, 2013, required for share issues, mergers, and insolvency valuations.

The ROC is the statutory authority under the Ministry of Corporate Affairs (MCA) responsible for registering companies and LLPs, maintaining the public register, and enforcing compliance with the Companies Act, 2013 across India.

REITs and InvITs are SEBI-regulated business trusts that pool investor capital to own income-generating real estate and infrastructure assets respectively, offering foreign investors listed, liquid access to Indian property and infra markets.

A contract or arrangement between a company and its directors, KMPs, holding/subsidiary companies, or other related parties, requiring board and sometimes shareholder approval under Section 188.

The transfer of money out of India to a foreign country, covering dividends, sale proceeds, profits, and investment returns.

The Resale Price Method (RPM) is one of six methods under section 165 of the Income-tax Act, 2025 (section 92C of the 1961 Act), pricing a related-party purchase by working back from the price the buyer resells it for.

The sequence in Article 4 of a tax treaty that assigns one country of residence when both India and a treaty partner separately treat the same person as their own tax resident.

A director of an Indian company who has stayed in India for at least 182 days during the financial year, as required by the Companies Act.

Formal decisions passed by shareholders or directors of Indian companies, classified as ordinary, special, or board resolutions with distinct voting thresholds and filing requirements.

A GST mechanism where the recipient of goods or services pays the tax instead of the supplier, applicable to notified supplies and imports of services into India.

An Indian government scheme that refunds embedded central, state, and local taxes on exported goods that are not rebated under other mechanisms.

India taxes a non-resident's royalty income (patents, trademarks, know-how, equipment use, and software licensing) at a flat 20% under section 207(2), deducted at source under section 393(2), unless a lower DTAA rate applies with proof of residency.

An MCA web service that allows applicants to reserve a proposed company or LLP name for 60 days before filing for incorporation.

A Y Combinator-originated investment instrument granting investors future equity rights without debt terms, lacking explicit recognition under Indian FEMA regulations.

Rules under Indian transfer pricing law that provide pre-determined profit margins or pricing thresholds, shielding qualifying transactions from further scrutiny.

SEBI regulations prohibiting trading in listed securities based on unpublished price sensitive information (UPSI), with penalties up to INR 25 crore or 3x profits.

SEBI's consolidated regulatory framework governing corporate governance, periodic disclosures, and compliance obligations for all listed entities in India.

A financial intermediary registered with SEBI to manage public offerings, private placements, M&A advisory, and other capital market activities in India.

Under section 170 of the Income-tax Act, 2025 (section 92CE of the 1961 Act), unrepatriated excess money from a ₹1 crore-plus transfer pricing adjustment is deemed an interest-bearing advance unless the assessee pays an 18% one-time tax instead.

A mandatory obligation for qualifying Indian companies to spend at least 2% of average net profits on social welfare activities listed in Schedule VII.

A 100% profit deduction for DPIIT-recognised startups for 3 consecutive years within their first 10 years, available to private limited companies and LLPs with turnover under INR 100 crore.

Section 207 of the Income-tax Act, 2025 sets two rate tables for a non-resident's Indian income: 20% dividend/interest (10% for IFSC dividends) under section 207(1), and 20% Government-approved royalty/FTS under section 207(2).

Section 393(2) of the Income-tax Act, 2025 (Table, Sl. No. 17; section 195 of the Income-tax Act, 1961) requires tax to be deducted at source, at the rates in force, on any payment (other than salary) made to a non-resident that is chargeable to tax in India.

A company registered under Section 8 of the Companies Act, 2013, for promoting charitable, social, educational, or environmental objectives, where profits must be applied towards the company's objects and cannot be distributed to members.

A Service Permanent Establishment arises when a foreign enterprise's personnel furnish services in India beyond the day threshold set by the applicable DTAA, commonly 90 days but absent in some treaties.

The reference number the MCA21 portal assigns to every webform or e-form submitted to the Ministry of Corporate Affairs, used to track its payment, approval, resubmission or rejection status.

A geographically demarcated zone in India with special fiscal incentives, streamlined customs procedures, and relaxed regulations designed to promote exports and attract foreign investment.

A parallel payroll run in a host country to track and report tax obligations for internationally assigned employees, paired with tax equalization to neutralize cross-border tax differences.

The legal mechanisms for companies to repurchase their own shares, for shareholders to transfer ownership, and for shares to pass to heirs on death under Indian law.

A private contract between shareholders governing rights, obligations, share transfers, and exit mechanisms — enforceable under the Indian Contract Act but subordinate to the AoA in case of conflict.

Contractual rights in shareholders' agreements that protect investors during share transfers, exits, and dilutive events — including ROFR, drag-along, tag-along, and anti-dilution clauses.

State-specific Indian labour laws mandating registration of all commercial establishments and regulating working hours, leave, wages, and employment conditions.

A DTAA provision exempting foreign employees from host-country income tax if they stay under 183 days and meet two additional conditions — distinct from India's domestic 182-day residency test under Section 6.

An individual who ultimately owns or controls at least 10% of shares, voting rights, or distributable profits in an Indian company, requiring mandatory disclosure under Section 90 of the Companies Act, 2013.

FDI policy allowing 100% foreign investment under automatic route for retail sale of a single brand, subject to 30% local sourcing from India.

A private company below the paid-up capital and turnover limits fixed under Section 2(85) of the Companies Act, 2013 (currently ₹10 crore and ₹100 crore), unless it is a holding, subsidiary, Section 8, or specially-governed company.

Bilateral treaties between India and other countries that prevent double social security contributions and allow totalization of service periods for pension eligibility.

The SOFTEX Form is the declaration a software or IT-enabled-services exporter files with a designated STPI or SEZ official within 30 days of invoicing, so RBI can certify the export's value and track realisation of proceeds through EDPMS.

The simplest form of business in India where a single individual owns, manages, and controls the enterprise with no legal separation between the owner and the business.

A distinct legal entity created for a specific, narrow objective — such as asset holding, project finance, securitisation, or investment structuring — designed to ring-fence risks and isolate liabilities from the parent company's balance sheet.

An integrated MCA web form that consolidates company incorporation, PAN, TAN, GST, EPFO, and ESIC registration into a single application.

A tax under the Indian Stamp Act, 1899 on issuing or transferring shares, charged at uniform national rates since 1 July 2020 and collected via depositories, exchanges, or a stamped Form SH-4 for physical shares.

Stamp duty is a state-levied tax on legal documents including lease and rental agreements, governed by the Indian Stamp Act, 1899.

State-specific policies offering capital subsidies, SGST reimbursement, stamp duty exemptions, and land concessions to attract industrial investment across India.

A legally mandated annual audit of a company's financial records conducted by an independent Chartered Accountant under the Companies Act 2013.

Shares issued by a company to directors or employees at a discount or for non-cash consideration in exchange for intellectual property, know-how, or value addition.

SEBI regulations governing mandatory open offers when acquiring 25%+ shares or control of a listed Indian company, protecting minority shareholders.

A mandatory audit under Section 63 for businesses and professionals exceeding prescribed turnover thresholds, reported in Forms 3CA/3CB and 3CD.

A tax collected by the seller from the buyer at the point of sale on specified goods and transactions, governed by section 394 of the Income-tax Act, 2025.

A 10-digit alphanumeric number required by every entity that deducts or collects tax at source in India under the Income Tax Act.

A mechanism where the payer deducts income tax at prescribed rates before making payments for salaries, rent, professional fees, and other specified transactions.

The three key registrations enabling Indian non-profits to claim income tax exemption (12A/12AB), offer donor deductions (80G), and receive corporate CSR funds (CSR-1).

A certificate issued by a country's tax authority confirming an entity's tax residency, required to claim benefits under India's Double Taxation Avoidance Agreements.

A treaty clause under which a country credits its resident for tax a treaty partner's incentive spared, as if that tax had actually been paid, so the incentive's value survives repatriation.

The single twelve-month period the Income-tax Act, 2025 uses (1 April–31 March), replacing the previous-year/assessment-year pair of the Income-tax Act, 1961.

POEM determines if a foreign company is tax-resident in India; SEP creates a taxable business connection for non-residents exceeding Rs 2 crore in transactions or 3 lakh Indian users.

A contract licensing IP, know-how, or technical services to an Indian entity, regulated by FEMA (automatic route) and subject to royalty withholding tax.

India permits 100% FDI via automatic route in telecom services since 2021, subject to DoT licensing, security clearance, and trusted source equipment requirements.

Anti-avoidance rules under Section 177 that cap interest deductions on debt from associated enterprises at 30% of EBITDA, targeting excessive debt-funded profit shifting.

Trade Credit is short-term foreign financing for Indian imports — Suppliers' Credit from the exporter or Buyers' Credit from an overseas bank — capped at the benchmark rate plus 300 bps (foreign currency) or 250 bps (rupee).

Letters of Credit (LCs) and Bank Guarantees (BGs) are bank-issued instruments that secure international trade payments and contractual performance under UCP 600 and RBI guidelines.

A mandatory permit issued by local municipal corporations (BMC, MCD, BBMP, etc.) authorising businesses to operate within their jurisdiction, requiring annual renewal.

Registration of a brand name, logo or mark under the Trade Marks Act, 1999 by filing Form TM-A with the Trade Marks Registry (IP India) for a specified class of goods or services.

The transfer pricing method under section 165(1)(e) of the Income-tax Act, 2025 that compares a tested party's net profit margin with margins earned by comparable independent companies.

Tax rules requiring transactions between related parties in different countries to be priced at arm's length, as mandated by sections 161 to 173 of the Income-tax Act, 2025.

India's three-tier TP documentation framework under Section 171 requires a Local File, Master File, and Country-by-Country Report for multinational groups with Indian operations.

The officer to whom an Assessing Officer refers determination of the arm's length price of international or specified domestic transactions under section 166 of the Income-tax Act, 2025, and whose order binds the Assessing Officer.

Treaty shopping is routing investments through a third country solely to access favorable DTAA rates. India combats it via GAAR, LOB clauses, and the MLI Principal Purpose Test.

A penalty under India's Income-tax Act equal to 50% of the tax on under-reported income, rising to 200% where the under-reporting is misreporting: false entries, misrepresentation, or undisclosed international transactions.

A mandatory fair market value certification required by RBI for cross-border share transactions involving non-residents, certified by a SEBI Merchant Banker or CA.

Virtual offices provide a registered address for company incorporation and GST registration in India without a dedicated physical lease, subject to Section 12 of the Companies Act, 2013.

India requires foreign workers to obtain Employment or Business Visas and register with the FRRO/FRO within 14 days of arrival for stays exceeding 180 days.

An Indian company where 100% of the shares are held by a single foreign parent company, operating as a separate legal entity.

Tax deducted at the point of payment on income earned by non-residents from Indian sources, including royalties, interest, dividends, and fees for services.

Three mandatory corporate compliance requirements under the Companies Act, 2013: XBRL-format financial filing, internal audit for larger companies, and secretarial audit for listed/public companies.