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2018 (8) TMI 1917 - AT - Income TaxIncome accrued in India - Additions in respect of interest income earned on foreign currency loans given to Indian Corporates - DTAA between India and Mauritius - HELD THAT:- As decided in own case in the context of the impugned interest income, Circular no. 789 dated 13.04.2000 (supra) of the CBDT is applicable while applying the provisions of Article II(3)(c) of the India-Mauritius Tax Treaty. On this aspect itself we uphold the plea of the assessee that assessee is the 'beneficial owner' of the impugned interest income on the strength of the Tax Residency Certificate issued by the Mauritian authorities. In the context of element of interest income earned by the assessee from Hyundai Motor India Ltd., the Chennai Bench of the Tribunal in its decision in the case of Hyundai Motor India Ltd. [2017 (4) TMI 1193 - ITAT CHENNAI] has already observed that the recipient therein (i.e. the assessee before us), was the 'beneficial owner' of the interest income qua the provisions of Article 11 of the India-Mauritius Tax Treaty. Be that as it may, in view of our aforesaid discussion, we uphold the stand of the assessee that it is the 'beneficial owner' of the interest income quo the provisions of Article 11(3)(c) of the India-Mauritius Tax Treaty and thus, such income is not taxable in India. Interest u/s. 234B - HELD THAT:- In view of the decision of CIT v. Sedco Forex International Drilling Co. Ltd. [2003 (10) TMI 40 - UTTARANCHAL HIGH COURT] it was to be held that when a duty is cast on the payer to deduct and pay the tax at source, on payer's failure to do so, no interest under section 234B can be imposed on the payee assessee. Be as it may, we have already decided the issue of exigibility to taxation in favour of the assessee. Hence, this issue is consequential.
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