The Supreme Court's judgment in Authority for Advance Rulings (Income Tax) & others v. Tiger Global International Holdings 2026 LiveLaw (SC) 50 marks a moment where that tension is not merely acknowledged, but decisively addressed. Quietly, and without theatrics, the Court applies to international tax law an instinct long familiar to company law: the willingness to look past...
The Supreme Court's judgment in Authority for Advance Rulings (Income Tax) & others v. Tiger Global International Holdings 2026 LiveLaw (SC) 50 marks a moment where that tension is not merely acknowledged, but decisively addressed. Quietly, and without theatrics, the Court applies to international tax law an instinct long familiar to company law: the willingness to look past formal compliance when substance tells a different story.
The case concerned whether gains arising from the sale of shares by Mauritian entities associated with Tiger Global were entitled to exemption under the India–Mauritius tax treaty, based on their Tax Residency Certificates. The Revenue contended that the Mauritian entities were mere conduits, lacking real control or commercial substance, and that the treaty benefit was being invoked to avoid tax in India.
For decades, Indian tax law has lived with a certain productive tension. On the one hand lies form: incorporation, residence certificates, treaty text, and carefully constructed investment pathways. On the other lies substance: control, purpose, decision-making, and the uneasy sense that some structures exist less to do business than to avoid consequence.
This is why the judgment deserves to be read not simply as a tax ruling, but as a veil-piercing moment for treaty law. Not the corporate veil as traditionally understood, but a treaty veil - one that separates paperwork from entitlement.
A familiar instinct, deployed in an unfamiliar setting
Courts have never been hostile to legal form. Incorporation matters. Contracts matter. Certificates matter. But courts have also never been naïve about them. Where form is deployed to disguise control, courts intervene. Where structure masks purpose, courts inquire.
What is striking about Tiger Global is not the outcome, but the instinct animating it. The Court does not begin with the treaty. It begins with sovereignty. The opening paragraphs of the judgment anchor the discussion firmly in Article 265 of the Constitution and the State's inherent power to levy and collect tax in accordance with law. Treaties are acknowledged as instruments of cooperation, not as abdications of authority.
That ordering does matter a great deal. It tells the reader how the Court is thinking before it ever reaches Tax Residency Certificates (TRCs) or Double Taxation Avoidance Agreements (DTAAs). Treaty obligations are real, but they operate within a constitutional frame that does not require the State to suspend disbelief when confronted with elaborate cross-border arrangements.
TRCs as a starting point, not a destination
Few instruments in Indian tax lore have enjoyed the near-mythic status that Tax Residency Certificates once did. For years, the presence of a TRC was treated, in practice if not in theory, as a near-conclusive answer to questions of residence and treaty entitlement. Produce the certificate, and the inquiry largely ended.
The Tiger Global judgment re-positions the TRC firmly where it belongs: at the threshold, not at the finish line.
The Court does not deny the relevance of TRCs. It does not question their statutory recognition. What it does say, unmistakably, is that a TRC answers only the first question - where the entity claims residence. It does not answer the harder question: whether the structure, taken as a whole, deserves treaty protection for the transaction under scrutiny.
This mirrors company law precisely. Incorporation establishes legal existence. It does not immunise a company from veil-piercing where control and purpose warrant closer examination. In the same way, treaty residence establishes eligibility to invoke the treaty. It does not guarantee the benefit of its most favourable provisions in every factual context.
Therefore, the Court's analysis of control, decision-making authority, and economic substance is not incidental. It is central. The inquiry into who truly directs the affairs of the Mauritian entities, where key decisions are made, and whether the entities function as autonomous commercial actors or as conduits, is the tax analogue of asking where the “head and brain” of a company truly lies. That instinct is articulated most plainly when the Court observes, “undoubtedly, the mere holding of a Tax Residency Certificate cannot, by itself, prevent an inquiry subsequent to the amendments brought into the statute … if it is established that the interposed entity was a device to avoid tax.” (para 43 of the judgment).
As the Court itself noted, treaty residence alone cannot be determinative where the situs of control, the locus of decision-making and the commercial rationale of the interposed entities reveal a structure divorced from economic substance.
This mode of inquiry is not unfamiliar to tax law. Long before Tiger Global, courts tasked with determining residence and effective management consistently looked past formal indicia to locate the factual seat of control. Board meetings were treated as a starting point, not as a conclusion. Where boards merely ratified decisions conceived elsewhere, courts were willing to disregard the façade and identify where real authority lay. Tiger Global carries that settled instinct into treaty entitlement, making explicit in the treaty context what had long been implicit in residence and management jurisprudence.
From documentary certainty to narrative scrutiny
What Tiger Global ultimately effects is not merely a clarification, but a recalibration of how treaty entitlement is to be assessed. By displacing the TRC from its formerly talismanic role, the Court shifts the centre of gravity from documentary sufficiency to economic substance.
The decisive question is no longer whether the paperwork is in order, but whether the structure, viewed as a whole and over time, tells a consistent and credible story. Control, decision-making authority, and commercial purpose are no longer peripheral considerations. They are the touchstone for determining treaty entitlement.
This represents a substantive shift. It replaces a relatively objective inquiry with one that is necessarily more qualitative. Certainty derived from form yields to scrutiny grounded in substance. For the Revenue, this demands a more sophisticated mode of analysis, moving beyond checklist verification to a careful reconstruction of how decisions are actually made. For taxpayers, it requires that treaty comfort be built on a contemporaneous and demonstrable record of genuine commercial activity and autonomous governance within the treaty jurisdiction.
Whether this transition produces a more equitable regime or a more contested one will depend on its application. No doubt, the judgment ends the myth of the TRC as an inquiry-terminating device, but it also entrusts significant discretion to those tasked with evaluating substance. The durability of this shift will therefore rest on the consistency, restraint, and institutional maturity with which this new mode of scrutiny is exercised.
Treaties as allocations of power, not shelters from scrutiny
A recurring anxiety in commentary around this judgment has been the fear that treaty certainty has been undermined. That fear, in my view, appears to be overstated.
Although the facts arose under the India-Mauritius DTAA, the court's reasoning is not treaty-specific. Its insistence on substance, control and commercial purpose would necessarily apply across India's treaty network, whether structures are routed through Singapore, the Netherlands, Cyprus or elsewhere.
The Court is careful to characterise treaties for what they are: agreements that allocate taxing rights between sovereigns. They are not shields against scrutiny, nor are they devices to render domestic anti-avoidance principles inoperative. The judgment emphasises that treaty interpretation must proceed in good faith, with attention to purpose and context.
What is often forgotten is that the near-conclusive status of TRCs was never an inevitable feature of treaty law. It was the product of executive reassurance, judicial tolerance and a prolonged policy choice in favour of certainty. Even during that period, courts repeatedly expressed discomfort with the idea that residence could be proved by certificate alone. Early rulings examined control and beneficial ownership despite formal residence, while later decisions articulated this instinct more explicitly by treating the TRC not as an inquiry-ending device, but as a rebuttable presumption. Even at its most deferential, the jurisprudence preserved space for scrutiny where structures appeared contrived, colourable or divorced from commercial substance. Tiger Global does not reverse that history. It releases it from long-standing restraint and places it squarely at the centre of treaty adjudication.
This is an important corrective to a tendency, particularly in transactional practice, to treat treaty benefits as a kind of contractual guarantee. Treaties are not insurance policies against tax. They presuppose genuine residence, genuine substance, and genuine commercial rationale.
By foregrounding sovereignty and constitutional principle, the Court makes clear that treaty obligations coexist with the State's authority to question abuse. That authority is not exercised lightly. But neither is it surrendered at the border of a DTAA.
The judgment is not a disagreement on facts. Read against the Delhi High Court's emphatic reaffirmation of the sanctity of Tax Residency Certificates, the Supreme Court's reasoning marks a deliberate shift in judicial posture.
Anti-avoidance, without the drama of GAAR
One of the more interesting features of the judgment is how little it relies, explicitly, on GAAR. This is not framed as a textbook GAAR case. There is no elaborate statutory exegesis of Chapter X-A, or a mechanical application of its provisions. And yet, the reasoning throughout bears the unmistakable imprint of anti-avoidance thinking.
The Court asks questions that GAAR asks instinctively:
Who controls the structure?
Why does it exist in this form?
What commercial purpose does it serve beyond tax positioning?
Does form align with function?
This is judicial anti-avoidance, exercised without statutory fanfare. The Court reasons as an anti-avoidance court would, even when it does not formally invoke GAAR as the decisive tool. That approach is significant. It suggests that anti-avoidance is no longer seen as an exceptional or invasive doctrine, but as part of the ordinary grammar of tax adjudication.
Just as veil-piercing in company law does not require a separate statute to be invoked in every case, treaty veil-piercing does not require GAAR to be waved like a banner. The instinct suffices.
Reconciling Vodafone and Azadi without disowning them
Much ink has been spilled on whether Tiger Global departs from Azadi Bachao Andolan or Vodafone. The better reading is that it does neither. It contextualises them.
Azadi was decided in a different era, under a different treaty regime, and in the absence of a mature statutory anti-avoidance framework. It stood for the proposition that treaty shopping, without more, is not impermissible. Vodafone reaffirmed that principle while also recognising the legitimacy of looking at the transaction as a whole where abuse is alleged.
What Tiger Global does is narrow the comfort zone that practitioners had begun to read into those decisions. It makes clear that neither case promised that formal residence or elaborate structuring would prevail against evidence of control and purpose inconsistent with treaty intent.
The Court does not overrule. It recalibrates. It moves from a posture of deference to one of scrutiny, shaped by changes in law, treaty text, and global tax norms. That is not inconsistency. It is evolution.
The real shift: from documentation to substance
Perhaps the most important implication of the judgment lies not in what it says about Mauritius, or Singapore, or indirect transfers, but in what it signals more broadly.
After Tiger Global, treaty comfort travels less on paperwork and more on substance. Structures will be tested not merely for formal compliance, but for narrative integrity. Does the story the structure tells - about control, management, and commercial purpose - survive judicial curiosity?
This is not a counsel of despair for investors. Nor is it a declaration of open season for Revenue. It is a statement of maturity. International tax law in India has moved to a stage where form is respected, but not worshipped.
A veil lifted, not torn
It would be a mistake to read the judgment as hostile to foreign investment or indifferent to certainty. The Court is not tearing down structures indiscriminately. It is lifting the veil where circumstances demand, much as courts have always done in company law.
In practical terms, this shift means that treaty entitlement can no longer rest on documentation alone. The narrative integrity of a structure must now be capable of being demonstrated through contemporaneous evidence of control, decision-making and genuine commercial purpose.
The significance of Tiger Global lies in its method. It normalises scrutiny. It embeds anti-avoidance reasoning into ordinary treaty interpretation. And it reminds us that legal fictions, however useful, are not ends in themselves.
In that sense, this is less a disruptive judgment and more a clarifying one. It tells investors, advisers, and administrators alike that treaties remain robust, but not unconditional. That residence matters, but so does reality. And that the law, when called upon, will ask not just whether the boxes were ticked, but whether the structure deserves the benefit it claims.
The Supreme Court has articulated the test; the tax administration must now administer it. The true measure of Tiger Global will lie not in the elegance of its reasoning, but in the consistency and restraint with which its substantive scrutiny is applied on the ground. The veil has been lifted; the responsibility to look wisely now passes to the Revenue and the lower courts.
That is not an alarming message. It is a grown-up one.
Author is Former Member (Judicial), National Company Law Tribunal. He continues to engage with insolvency, judicial process, and institutional reform through writing, research, and advisory work.
Views are personal