In a recent ruling in the case of Ardex Investments Mauritius Ltd.1 (‘the . the case of Azadi Bachao Andolan (above), no further enquiry on the. Reliance was placed on the Supreme Court rulings in the cases of Azadi Bachao. Andolan and Vodafone6. • The majority of the judges in the. The HC has followed the ruling of the Apex Court in the landmark case of Union of India v. Azadi Bachao Andolan [ Taxman
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Section 49A of the Income-tax Act, enabled the Central Government to enter into an agreement with the government of any country outside India for the granting of relief in respect of income on which, both income-tax including super-tax under the Act and income-tax in that country, under the Income-tax Act and the corresponding law in force in that country, had been paid.
Further, according to Vogel, “only in exceptional cases, and only when expressly agreed to by the parties, is exemption in one contracting State dependent upon whether the income or capital is taxable in the other contracting state, or upon whether it is actually taxed there. This income was wholly exempt from tax in Netherlands by reason of the Income Tax Law applicable therein.
The Hindu : SC settles law on double tax avoidance agreement
Thus, though after failing before the Apex Court in both appeal and consequent review the above amendments can be seen as the attempts by revenue to take the legislative route to unsettle Vodafoneand enforce its tax demands. Maharani Enterprises, Delhi v. Inasmuch as the impugned circular directs the income-tax authorities to accept a certificate of residence issued by the authorities of Mauritius as sufficient evidence as regards status of resident and beneficial ownership, it is ultra vires the powers of the CBDT.
The High Court has held, and the respondents so contend, that the assessing officer under the Income-tax Act is entitled to lift the corporate veil, but the circular effectively bars the exercise of this quasi-judicial function by reason of a presumption with regard to the certificate issued by the competent authority in Mauritius; conclusiveness of such a certificate of residence granted by the Mauritius tax authorities is neither contemplated under the DTAC, nor under the Income-tax Act a provision as to conclusiveness of a certificate is a matter of legislative action and cannot form the subject matter of a circular issued by a delegate of legislative power.
International Tax Avoidance Issues: An Analysis of the Indian Law and Policy
dase The CBDT under this section is empowered to issue such orders instructions and directions to other income-tax authorities “as it may deem fit for proper administration of this Act”.
While clause azaei talks of granting relief in respect of income on which income-tax has been paid in India as well as in the foreign country, clause b is wider and deals with ‘avoidance of double taxation of income’ under the Act and under the corresponding law in force in the foreign country.
Debts Recovery Appellate Tribunal.
He had earned anxolan money by boxing in the United States for which he was called upon to pay tax. National Company Law Tribunal. This, the High Court thought amounts to issuing instructions “de hors the provisions of the Act”.
A curious development is that, the circular itself has been meanwhile withdrawn and replaced by a circular authorising the assessing officer to question the physical residence evidenced by incorporation certificate issued by the participant country in the treaty with India by Circular No. The Act was challenged as being unreasonable since it retrospectively made the dealers liable for sales tax which they had not passed on to others. Consequently, the ruling had attained finality and maintainability of the Taxpayer’s application could not be challenged at this stage before the HC.
Words cannot be added to or substituted so as to give a meaning to the statute which will bachak the spirit and intention of the legislature. Log in No subscription?
Union Of India And Anr vs Azadi Bachao Andolan And Anr on 7 October,
India is bacyao facing a huge law and policy challenge in international taxation. The question whether a particular delegated legislation is in excess of the power of the supporting legislation conferred on the delegate, has to be determined with regard not only to specific provisions contained in the relevant statute conferring the power to make rule or regulation, but also the object and purpose of the Act as can be gathered from the various provisions of the enactment.
The exemption merely prevents the excise authorities from collecting tax when the exemption is in operation. The term ‘resident of India’ and ‘the resident of Mauritius’ are to be construed accordingly. Property of an offshore company 1 Subject to sub-section 2an offshore company shall not hold.
The Commissioner Of Income Tax bafhao. Union of India v. The High Court held that under the terms of agreement, if there was a recognition of the power of taxation with the Malaysian Government, by implication it takes away the corresponding power of the Indian Government.
This aspect of the matter has caxe been subject matter of amendment to meet the objection of the High Court in clearer terms by empowering the Government to enter into agreements for promoting “mutual economic relations, trade and investments” by Finance Act, The question was whether this entry covered furnace oil.
Where there is no specific provision in the Agreement, it is the basic law, i.
In case of disagreement on the corrections notified on the basis of this Article, the dispute is submitted at the request of the taxpayer, to the opinion of the abuse of tax law.
Commissioner of Central Excise, Nagpur TM to find other cases containing similar facts and legal issues.
But the obligations arising under the agreement or treaties are not by their own force binding upon Indian nationals. For this reason, we refrain from making any observations about the correctness or otherwise of the assessment order made in Cox and Kings Ltd.
Reliance Industries Limited v. Azadi Bachao Andolan supra The conceptual clarity on the differences between tax evasion and tax avoidance has also been brought out at the very onset, as obliterating the difference between the two creates more problems in properly analysing the said judgments. There is, of course, no doubt that they are within their legal rights, but that is no reason why their efforts, or those of the professional gentlemen who assist them in the matter, should be regarded as a commendable exercise of ingenuity or as a discharge of the duties of good citizenship.
Central Electricity Regulatory Commission 0. Lord Wilberforce was at pains to stress that the fact that the motive for a transaction may be to avoid tax does not invalidate it unless a particular enactment so provides see 1 All ERAC at The High Court seems to have heavily relied on an assessment order made by the assessing officer in the case of Cox and Kings Ltd.
In our view, this thinking of the High Court is erroneous. The expression used is ‘liable to tax therein’, by reasons of various factors. Media, Telecoms, IT, Entertainment.
We do not think the circular in any way takes away or curtails the jurisdiction of the assessing officer to assess the income of the assessee before him. It was found that in view of the provisions in the domestic law, the treaty law get assimilated as part of the domestic law even as laid down by the Supreme Court and High Courts in a number of cases and conceded by Board Circulars apart from the clear language of law and the precedents in other countries in interpretation of treaty law.
Second, despite two separate judgments rendered by Ranganath Misra, J. The observations which are sought to be relied upon by the respond The Federal Court found that under Article 13 2 a ii of the DTAC shares in a company were treated as personalty, that since the place of incorporation of a company or the place of situs of a share may be the subject of choice, the place of incorporation or the register upon which shares were registered would not form a particularly close connection with shares to ground the jurisdiction to tax share profits.
See also Tata Motors Ltd. Appellate Tribunal For Electricity 0. Competition Commission Of India.