(a) An Indian company investing in a foreign enterprise and paying taxes to the foreign country on the profits arising out of its investment 

(b) A foreign company investing in India and paying taxes to the country of its based on the profits arising out of its investment 

(c) An Indian company purchases tangible assets in a foreign country and sells such assets after their value increases and transfers the proceeds to India 

(d) A foreign company transfers shares and such shares derive their substantial value from assets located in India 

Ans: d

Explanation:

A “transfer” is a change in the direct or indirect ownership of an asset, in whole or in part, whether between independent or related parties. Transfers of ownership may give rise to a taxable capital gain (or loss). It has been defined to include sale, exchange, relinquishment and extinguishment of rights. 

Transfers can be ‘direct’ or ‘indirect’: 

A direct transfer involves the disposition of a direct ownership interest in an asset, in whole or in part. 

An indirect transfer involves the disposition of an indirect ownership interest in an asset, in whole or in part. It is the underlying asset that is being indirectly transferred. It is the transfer of shares of an overseas company which derive its value substantially, directly or indirectly from the assets located in India, are deemed to be assets situated in India. Direct or indirect transfer of such share triggers tax liability in India.

Hence, option d is correct.

Read: Solved Economy PYQs With Explanation 2022 UPSC Prelims