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2016 (4) TMI 337 - AT - Income TaxApplicable rate of tax - India-Cyprus DTAA - as per revenue the benefit of the lower rate of tax prescribed in India-Cyprus Double Taxation Avoidance Agreement (DTAA) could not be allowed since assessee has failed to file any revised return to show that the non-filling of the schedule of S.I in the return of income was an inadvertent mistake - Held that:- Assessee is entitled to the benefits of the India-Cyprus Double Taxation Avoidance Agreement ('DTAA') and its income is liable to be taxed at the lower rate of 10% as per India- Cyprus Double Taxation Avoidance Agreement (DTAA), mere technical error would not defeat the claim of the assessee, which is otherwise in accordance with law. In the case of CIT vs. Rajasthan Fasteners (P) Ltd., [2014 (6) TMI 291 - RAJASTHAN HIGH COURT] the assessee’s claim for exemption under section 10B of the Act was sought to be denied by the Revenue on the ground that while E-filing the return of income, the claim was wrongly mentioned as being under section 80IB of the Act, which was sought to be explained by the assessee as a mere typographical error. The Hon’ble High Court affirmed the stand of the Tribunal, whereby the claim of the assessee for exemption under section 10B of the Act was allowed considering that a mere typographical error in mentioning section 80IB of the Act in the return of income would not disentitle the assessee’s claim for exemption under section 10B of the Act. - Decided in favour of assessee Addition on interest income - interest income was liable to be assessed on accrual basis or receipt basis - Held that:- As relying on Article 11(1) of the India-Cyprus Double Taxation Avoidance Agreement (DTAA) to mean that the interest income in question is liable to be taxed on payment/receipt basis and not on accrual basis, as sought to be made out by the Assessing Officer. The plea of the assessee that by an inadvertent error such amount has been included as income on accrual basis, such solitary error cannot be construed to mean that assessee has not been following the cash basis of accounting regularly. In our considered opinion, the plea of the assessee is quite justified, and in any case, the applicable legal position on any point has to be arrived at by keeping in mind the relevant provisions of law and not merely by the conduct of the parties. Ostensibly, Article 11(1) of India-Cyprus Double Taxation Avoidance Agreement (DTAA), which covers the instant situation provides for taxation of interest income on payment/receipt basis and not on accrual basis.- Decided in favour of assessee
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