Our Podcast

Smita Jha and Supratim Chakraborty discuss how RBI’s FREE-AI Framework is shaping the future of finance in India. As AI increasingly drives underwriting, credit scoring, fraud detection, process automation, customer support, risk management, and compliance, clear regulatory guidance has become essential. The framework lays out guiding principles, called Sutras, along with practical recommendations to ensure innovation proceeds with accountability and trust.

The conversation highlights the framework’s twin pillars, Innovation Enablement and Risk Mitigation, and their significance for financial institutions navigating an AI-driven landscape. Innovation Enablement focuses on building high-quality, interoperable financial-sector data infrastructure and AI sandboxes for safe testing, while Risk Mitigation emphasizes governance, board-approved AI policies, data lifecycle management, consumer protection, and transparent reporting.

Smita and Supratim also explore the convergence of finance and privacy. While AI enables efficiency and broader credit access, privacy safeguards are critical to prevent misuse of sensitive data. Embedding AI literacy, fostering a culture of governance, and proactively managing risks are essential to responsible adoption. The discussion demonstrates how innovation and accountability can coexist to strengthen India’s financial ecosystem.

Megha Agarwal and Shaily Gupta discuss the Supreme Court’s landmark Hyatt International ruling and its impact on Permanent Establishment exposure in India. The case arose when Hyatt, through its UAE tax resident entity, entered into Strategic Oversight Services Agreements with an Indian hotel owner. Indian tax authorities argued this created a Permanent Establishment, upheld by the Income Tax Appellate Tribunal and Delhi High Court. The Supreme Court confirmed Hyatt had a fixed place PE in India due to sustained employee visits and substantive operational control over day-to-day hotel operations.

The Court clarified that profits attributable to the PE must be taxed as if it were an independent entity, making Hyatt liable even if the foreign enterprise reported overall losses. Megha and Shaily explore how the ruling extends beyond hospitality, affecting sectors such as apparel, electronics, quick-service restaurants, and any foreign brand owner exercising operational control in India.

The discussion highlights the importance of reviewing contracts, defining operational boundaries, documenting employee visits, and establishing strong compliance frameworks. The ruling underscores that substance prevails over form and urges multinational companies to reassess their India operations to manage tax risk effectively.