As per public information, in proposed deal, shares of holding company Flipkart Singapore (i.e. a foreign company) would be transferred to Walmart. Generally, any gain arising from sale of shares of a foreign company is not liable to income tax in India. However, pursuant to Vodafone controversy, ‘indirect transfer’ provisions were introduced under domestic tax laws, providing that gains from transfer of shares of foreign company could be taxed in India, if such shares derive its value substantially from assets situated in India, which would be apparently satisfied in Flipkart’s case, since entire business of Flipkart is situated in India. A Taxing Deal