"(viib) where a company, not being a company in which the public are substantially interested, receives, in any previous year, from any person being a resident, any consideration for issue of shares that exceeds the face value of such shares, the aggregate consideration received for such shares as exceeds the fair market value of the shares:
Provided that this clause shall not apply where the consideration for issue of shares is received by a venture capital undertaking from a venture capital company or a venture capital fund"
Now, there may be situations where a start-up is unable to use this exemption [say, where the investor is not registered as a VC fund in India]. There are trivial work-arounds for such cases, which any decent tax advisor can come up with. [Eg: Issue shares at face value, but with lower voting / dividend rights etc].
Long story short, I don't expect things to change in any meaningful manner on the ground.
PS: Last year, the tax department identified several cases where kickbacks from govt projects were disguised as share investments at very high premiums. The tax department seems to have brought in a (half-baked) proposal to stem such money laundering.
PPS: IAACA, sadly
Honestly if we don't stop the up and coming countries from repeating our mistakes then what do we gain? A big fat nothing. A so hate this excuse of its not fair to them, well tough shit. We know better now and they can't claim to not know better either. If we get them off on the right foot it is going to be a lot easier for all of us. If we excuse them then we just push the problem off to the next generation. Of course that seems to be the aim of almost all politicians these days, push off to another generation what we are not willing to do today.
I have a more apt analogy than your pizza one.... just because Jack murders a dozen people doesn't excuse John from killing one.
Well, the developed world needs to *help* the China/India not repeat their mistakes - just crying "Stop!" isn't going to help one bit.
Look at it this way - the west needs to pay for what it has done to the environment. Why not do it through funds / technology transfer to developing countries to help them develop clean industries?
Where's Jack's punishment?