This interview has been published by Priyanka Karwa and The SuperLawyer Team
You’ve had an impressive career in the field of indirect tax advisory, but I’m curious to know what initially drew you to the field of taxation. Could you also share your journey and the factors that led you to pursue law as your career?
Thank you for taking interest in my career journey. I come from a business family, and as I grew up, the plan was always to brace the entrepreneurial journey, so I pursued commerce as the stream. I started looking after the books of accounts of our firms as I was graduating, which drew me closer to the number game in terms of the financial management and tax planning, and that is when I decided to pursue Chartered Accountancy.
During my articleship, as we represented clients before the tax authorities, I saw a scope in pursuing law as a career. I was drawn towards the legal aspect of taxation, since even while defending the clients, we used to always rely on the legal jurisprudence. I therefore decided to develop my legal acumen and use the skills that I acquired during my articleship to step into the legal industry and make the most out of it. The immense support that I received from my family and friends during this phase of my career is unforgettable.
Interestingly, when I joined Lakshmikumaran & Sridharan Attorneys, I was the only Chartered Accountant at their Bangalore office. Since then, the journey has been nothing but a rollercoaster, but one which I have thoroughly enjoyed throughout. I consider myself fortunate enough to be able to pursue indirect tax as my core area of practice. And I think the idea to pursue Law along with Chartered Accountancy has been one of the best decisions of my career. Having said the same, I truly aspire to be amongst the leading indirect tax lawyers in the country.
As a Partner at Lakshmikumaran & Sridharan Attorneys, you play a key role in overseeing business development and client outreach. Can you tell us about a specific strategy or initiative you’ve been involved in that significantly contributed to the firm’s growth and success?
This is an interesting question. It is a well known fact that the outcome of business development and client outreach programmes are some of the key indicators to gauge a partner’s performance in law firms. I have been actively involved in such programmes, wherein we quite often discuss and strategize how to identify issues and support clients to structure their business to align with relevant laws. As part of regular business development activities, we try to generate leads and identify new projects in the areas of taxation. These initiatives have steered me to think out of the box and helped me in associating with new clients and securing new assignments from the existing clients as well.
I use social media platforms like LinkedIn and other applications to identify potential work opportunities, and also to share my views on issues that the industry may be facing. My regular interaction with business associations and Government’s grievance redressal committees not only helps me update myself with ongoing legal issues but also enables me to act as a medium for exchanging information between the stakeholders. I also try to attend as well as serve as a key speaker in important networking events through webinars or seminars. As a partner, it is my endeavour to offer strategic business development advice to the leadership, practice groups, and other associates who are working to strengthen their ties with the clients.
One of the most important things that I have realised throughout my journey is the importance of building trust. If your client does not trust you, they will never come to you. Even while providing them advice on the issues, I try to follow-up with them regularly to ensure that they don’t face any issues in implementation of the advice. I am also very active in updating the clients of any changes that are brought into the law which may have an impact in their business. This sense of involvement in their business has helped me gain their trust and confidence over the years. I strongly believe in building professional relationships with clients, which has worked in my favour over the years.
One of your significant achievements was in the implementation of GST (Goods and Services Tax) for various clients across different sectors. Given the complexity of this tax regime, what challenges have you encountered while working with clients from various industries, and how do you navigate these challenges effectively?
When the GST laws were implemented back in 2017, the industry was caught unprepared. That is when our role as indirect tax practitioners played a key factor in providing requisite support to the clients. I very proactively took up the responsibility of understanding business needs for ensuring a seamless and glitch free implementation and smooth transitioning of the old laws such as Central Excise, VAT and Service Tax into the GST regime.
One major challenge that I faced was that as new as the GST laws were for the clients, it was new for us as well. Therefore, understanding the GST laws in depth and to align them with different business models effectively and efficiently with no room for error was a major challenge initially as it required a lot of brainstorming. Maintaining the finest quality of drafts at the shortest turnaround time was another challenge that we overcame as a strong team. However, with time we ensured smooth transitioning of business from the erstwhile laws to GST law.
Tax laws are ever evolving, and we often face challenges in implementing them in the dynamic business environment. However, my interest in these laws is such that I try to keep myself updated with every minor change that is brought in, to make sure that when my clients need some advice, I am updated enough to be able to provide them with a well-researched and practically implementable opinion.
You provide legal opinions and undertake tax compliance review for your clients. Could you share an example of a particularly complex or interesting case where your expertise in this area made a significant impact?
Well, I would not like to call this complex, but an interesting judgement of the Supreme Court last year changed the position of a well settled law. The Apex Court in the case of Northern Operating Systems held that secondment of expatriates from foreign group companies to its Indian counterpart constitutes provision of manpower services and thereby leviable to tax. The industry under the genuine belief was not discharging GST. Pursuant to pronouncement of the said Judgement, the Industry has been receiving show cause notices from the Department with a proposal to demand GST along with interest and penalty, right from 2017. Since the volume of transactions is huge it has adversely impacted the Industry as it has become a huge cost for them. We are consistently working on this issue to justify the position and defend the same at appropriate forums to ensure that the issue does not have any further adverse effect on the industry and appropriate relief is provided to them in a time bound manner. I am hopeful that the Government would consider our submissions and come out with an eagerly awaited relief package for the industry.
You oversee all tax compliances and tax related disputes of your family business. How did this experience in the corporate sector influence your perspective on tax compliance and advisory work, and what lessons did you carry forward into your legal career?
Well, over the years I have learnt that the tax structure does not drive the business, rather it plays a minute but significant role in the decision making process. My experience in the corporate sector has given me a deep insight into how business decisions are taken. Obviously, the decision-making process in a corporate setup is very different from that of a family run business, but the objective of every organisation remains the same, i.e., to grow by being tax compliant.
The major practical challenge comes when I have to implement any advisory by understanding the business from the client’s perspective. The aim is always to be very certain while providing some advice to ensure that even if the same is challenged in the court, I am confident enough to defend the position. It has only taught me the importance of paying attention to every detail, no matter how small it is. An important lesson I have learnt which I strive to carry throughout my career is to never stop learning – every day is new; every day comes with a new challenge and the learning should never stop. I strongly believe that one should always be open to new challenges and opportunities.
Lastly, I would also like to state that my team plays a crucial role in my success, and I wouldn’t be able to reach where I am without them. There have been many life-long lessons learnt along the way, but the core of what sticks with me is the significance of having good team building and communication skills, and to believe and encourage your people to deliver results as a team.
In your role as a partner and throughout your career, you’ve been involved in recruiting and mentoring juniors. What advice do you have for young professionals looking to excel in the field of indirect tax advisory and taxation law?
I would like to say to all young professionals that the dynamics of tax laws is very interesting. It is very important to start early and keep yourself updated regularly. You should have a really strong memory bank to remember and apply the legal provisions and important judgments as you interact with the clients or even colleagues. Have a proper repository of all important case laws and keep them handy for future usage. Stay focussed, be on your toes and develop skills to have a quick turnaround time. You may not realise it now, but the skills to have good turnaround time really does wonders in the long run.
As a young tax professional, one must try and understand practical nuances of law and significance of or rationale behind any amendment, pay attention to facts of each case, be in regular touch with your clients and understand their business by stepping into their shoes. The scope for professional as well as personal growth of tax lawyers in India is immense considering what a niche field of law this is, so make the most of it. It goes without saying that specialisation in a particular field of law is important, but I also believe that one must have a general understanding of allied laws and regulations which is equally important for professionals who are passionate to excel in the field of indirect tax.
Your career highlights include providing advisory and litigation support for multinational clients. What advice can you offer to businesses, especially those with a global presence, to navigate the complexities of international taxation and compliance effectively?
Navigating through the complexities of taxation and compliance can be challenging for businesses with a global presence. It is crucial to have a well-thought-out strategy and a team of experts to ensure you comply with local regulations while optimizing your tax position. I would really like to emphasize to the companies to have a good understanding of local tax laws. Establish a well-documented transfer pricing policy to determine how your transactions with global entities are priced. This helps prevent disputes with tax authorities and ensures compliance with local regulations on Income Tax as well as Customs front. Be aware of any Tax Treaties or Free Trade Agreements between countries. These treaties and agreements can affect the income tax rates you are subject to and the benefits you may receive on import of goods from outside India.
As a policy, MNCs tend to invest heavily on advanced accounting and tax technology solutions to manage their global financial data. These practices help them to automate reporting, improve accuracy, and provide insights into their international operations. One challenge I have observed during all these years is the preparedness of MNCs when it comes to submission of documents and records to tax authorities. It is crucial to maintain meticulous records of all financial transactions and relevant documents. Companies can strategize on identifying potential risks and uncertainties in their tax positions and back them with legal opinion from experts wherever necessary. They can also develop risk mitigation plans and strategies to deal with disputes or unexpected changes in tax laws with the help of their in-house counsels or external consultants.
A fundamental advice I would like to give to the MNCs is to provide tax and compliance training to the employees who are responsible for undertaking financial transactions or dealing in tax matters. This can help prevent inadvertent non-compliance issues. Conducting regular audits and reviewing tax and compliance practices from time to time go a long way to ensure continued adherence to the ever-evolving tax laws.
Finally, as someone with a wealth of experience in the legal and taxation fields, what advice would you like to give to students and fresh law graduates who are just beginning their journey in the legal profession and may be considering a career in taxation law or advisory?
Starting a career in the legal profession, particularly in an area of law such as taxation can be both challenging and rewarding at the same time. Few pieces of advice for students and fresh law graduates embarking their journey in this field is firstly to build a strong foundation in understanding general principles of law before specialising in tax laws. You have to be very patient since tax laws are complex and are constantly evolving. Develop a professional network early in your career. Attend legal seminars, conferences and events to get accustomed to tax jargon. This will really help you build your confidence and develop good communication skills. Seek out mentors who have experience in tax laws and never be hesitant to ask for help.
As part of the education curriculum, students must work on developing strong research, writing and negotiation skills. Be adaptable in your approach to develop problem solving skills and techniques. Lastly, be humble! Kindness plays a pivotal role in establishing yourself in any firm or organization that you will go to.
As a parting remark, I would like to mention that taxation is one of the oldest coded laws, but a niche area of practice and is certainly worth considering as a long term career option.
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