Twitter faces more heat in India; Govt plans new framework for angel investors

Twitter faces more heat in India; Govt plans new framework for angel investors
Photo Credit: Photo Credit: Reuters
13 Mar, 2019

The Indian government has cautioned Twitter that its top executives could face jail time and financial penalties if the microblogging platform fails to remove “objectionable and inflammatory content” as per law, The Times of India reported.

Citing government officials it didn't name, the report said the Ministry of Electronics and Information Technology has warned Twitter it must comply with provisions under the IT Act, including Section 69A that allows the government to ask platforms to block accounts and posts which incite violence and disrupt the sovereignty of the country. 

The report also cited a government official as saying that while Twitter had started complying in some cases, it remained unresponsive in many other cases.

The warning comes at a time when Twitter is already battling problems in India. On February 25, Twitter's public policy head Colin Crowell had deposed before a parliamentary committee on issues of blocking accounts ahead of the general elections. This came after the panel asked Twitter CEO Jack Dorsey to appear before it.

Angel tax

Meanwhile, the Department for Promotion of Industry and Internal Trade (DPIIT) is mulling a mechanism for accreditation for investors to make angel investing hassle-free in the light of recent developments on the so-called angel tax, The Economic Times reported.

Citing a government official it didn't name, the report said an accreditation regime was being discussed which does not put ‘genuine’ investors at risk. 

According to the Income Tax Act, an angel investor is defined as an individual with a minimum net worth of Rs 2 crore and minimum annual taxable income of Rs 25 lakh for the last three years.

The move comes amid the controversy surrounding angel tax. Section 56(2) (vii) (b) of Income Tax Act treats capital received from angel investors as ‘other sources of income’ and taxes it on a par with corporate taxes at 30%.

Recently, close to 200 startups and angel investors said that they had received notices for angel funding rounds raised in 2015-16. Last month, the DPIIT and the Central Bureau of Direct Taxes relaxed the angel tax norms including the definition of a startup.