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In a nutshell, the legal and tax ramifications are that you are subjecting your Indian company to the laws and taxes of the United States. Your branch office in California will be subject to California law (and applicable federal law); and the income earned through the California office will be taxed by the U.S. federal government as well as state and local authorities. In addition, you may run into issues regarding the transfer of funds from the California branch to the overseas parent company. Make sure you speak to attorney and accounting advisors in both India and California who have experience with this sort of situation (overseas parent company/U.S. branch office) to determine the best way to set this up.
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