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Income tax Update – CBDT enlists 3 categories of persons not covered under the Angel tax provisions

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The CBDT has notified the 3 categories of persons whose investments in the Closely Held Companies shall not be covered within the ambit of Angel tax provisions.

The Notification reads as follows :-

In exercise of the powers conferred by sub-clause (ii) of the first proviso to clause (viib) of sub-section (2) of Section 56, the Central Government hereby notifies the following class or classes of persons, for the purposes of the said clause, namely:-

  • Government and Government related investors such as central banks, sovereign wealth funds, international or multilateral organizations or agencies including entities controlled by the Government or where direct or indirect ownership of the Government is seventy-five percent or more;
  • Banks or Entities involved in Insurance Business where such entity is subject to applicable regulations in the country where it is established or incorporated or is a resident;
  • Any of the following entities, which is a resident of any country or specified territory listed in Annexure, and such entity is subject to applicable regulations in the country where it is established or incorporated or is a resident :––
    • entities registered with Securities and Exchange Board of India as Category-I Foreign Portfolio Investors;
    • endowment funds associated with a university, hospitals or charities;
    • pension funds created or established under the law of the foreign country or specified territory;
    • Broad Based Pooled Investment Vehicle or fund where the number of investors in such vehicle or fund is more than fifty and such fund is not a hedge fund or a fund which employs diverse or complex trading


List of Countries


Sl. No. Name of Country/ Specified Territory
(1) (2)
1 Australia
2 Austria
3 Belgium
4 Canada
5 Czech Republic
6 Denmark
7 Finland
8 France
9 Germany
10 Iceland
11 Israel
12 Italy
13 Japan
14 Korea
15 New Zealand
16 Norway
17 Russia


18 Spain
19 Sweden
20 United Kingdom
21 United States


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