Indian tax officials have reportedly proposed denying benefits from Jane Street Group LLC’s tax treaty with Singapore and recommended taxing the firm’s profits as capital gains amid ongoing problems with India’s markets regulator, according to a report in the Economic Times.
Officials of the investigation unit have reportedly recommended that Jane Street be denied the application of the General Anti-Avoidance Regulations (GAAR) and that the profits recorded by the company in India be taxed as capital gains, it said, citing sources.
The investigation wing of the income tax department was probing Jane Street’s profits following the Securities and Exchange Board of India’s (SEBI) order on July 3 against the US trading firm for alleged manipulation, he added.
According to a Bloomberg report on the same, Jane Street and SEBI did not respond to queries outside business hours.
What did SEBI charge against Jane Street?
SEBI accused the company and its entities in India, Hong Kong and Singapore of manipulating the Nifty and Bank Nifty indices and making “illegal” profits of approx. ₹36,500 crore and suspended its operations on 3 July 2025.
Sebi alleged that Jane Street bought a large number of components in the Bank Nifty index in the cash and futures markets to artificially prop up the index in morning trade, while creating large short positions in index options that were exercised or allowed to expire later in the day.
The following week, the company was allowed to continue trading after the filing ₹4,840 crore in an escrow account but sought an extension to refute the allegations. In September, the company appealed SEBI’s order at the Bombay Court of Appeal. The case is still ongoing.
New York-based Jane Street posted trading revenue of nearly $7 billion in the third quarter. It has been trading equities, equity futures and index options in India since it started operations after the COVID-19 pandemic. The company made a profit of more than $4 billion from trading in stocks, futures and options between January 2023 and March 2025, according to SEBI’s original order.
Jane Street Group was founded in 2000 as a global proprietary trading firm in the financial services industry. According to the trading firm’s website, it has more than 3,000 employees in five global offices.
(With inputs from Bloomberg)
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