In the ultimate analysis, some human beings are the real beneficiaries of the corporate advantages, for while, by fiction of law, a corporation is a distinct entity yet in reality, it is an association of persons who are in fact the beneficiaries of the corporate property. Therefore, it may happen that the corporate personality of the company is used to commit frauds or improper or illegal acts like tax evasion. Thus, the concept of piercing or lifting the corporate veil holds significance. A corporate veil may be pierced either through statutory provisions or by judicial interpretation. Piercing the corporate veil in taxation matters is an outcome of judicial decisions. This Article firstly deals with the pros and cons of the concept of tax evasion and piercing the corporate veil. It pertains to situations in which piercing of corporate veil in taxation matters is considered valid and convincing. Then it goes on to emphasizing the notion, construction and legality of lifting the veil in India, United States and United Kingdom. It also stresses on the Direct Tax Codes and the scope of piercing the veil. It is analytical and descriptive in nature and doctrinal in approach.
Cite this article:
Apoorva Neral. Piercing of Corporate Veil in Taxation Matters (India and International Transactions) with Reference to Direct Tax Codes. Research J. Humanities and Social Sciences. 4(3): July-September, 2013, 380-391.