BANGALORE, India --- Practo, a high-flying health care startup backed by China's Tencent Holdings, is being investigated by Indian authorities looking into whether it evaded tax through a cross-border corporate restructuring.
According to a notice from the Bangalore office of the Department of Income Tax seen by Nikkei Asian Review, Practo executives have been summoned to explain wide discrepancies between different company valuations conducted just a month apart in 2014. The lower valuation was used in calculating capital gains tax owed on the transfer of assets to an offshore affiliate in Singapore. The tax authorities searched Practo's offices in Bangalore and seized company records in late May, according to an official familiar with the investigation.
