“The change on angel tax provisions being extended to non-residents could have significant consequences on fund raise structures from offshore funds and foreign companies. FEMA provisions permit Indian companies to issue shares to non-residents at above the fair market value. Now any such excess will be taxable in the hands of the company. Such onerous deeming income provisions will impact genuine FDI transactions in the country. One can also expect heightened scrutiny of valuations at which the funds are raised. Since the funds raised from AIFs are exempt, there may also be increase in investments from non-residents through AIFs”