Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2010 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2010 (7) TMI 533 - AT - Income TaxDTAA – Reassessment – Assessee claimed the credit for tax deduction deducted on the dividend in the UK and also relief under DTAA between India and UK - Held that: - as per the law applicable for the assessment years from 2000-01 to 2004-05, if the assessee is desiring to get the benefit of the tax credit as available as per U.K. Law then he will be treated at par with the resident of the UK and the amount received by the assessee is then deemed to increase by 1/9th of dividend received from the U.K. Company for the purpose of taxation under Indian Income Tax Act and tax credit can only be adjusted against his tax liability in India but he can not claim refund, if any, in case his tax credit is more than his tax liability. The tax is not deducted at the time of payment of the dividend. There is a corporation tax, which the company is liable to pay. But the corporation tax paid by the company has no implication on the amount received by the assessee. In our opinion, the purpose of Article 24 is totally different in the sense that the Article 24 comes to aid where the same profit or income is taxed in sourcing country as well as in another Contracting State. So far as sec. 91 is concerned, the said section has no application to the assessee’s case as admittedly, there is an existing Treaty between India and UK and the said section applies where there is no treaty or agreement under sec 90 of the Income Tax Act. We, therefore, direct the AO to assess the dividend after increasing by 1/9th tax credit as discussed herein above on deemed gross basis in the hands of the assessee and also allow the tax credit as per Article 11 (2) for the A. Yrs. 2000-01 to 2004.
|