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2017 (3) TMI 1376 - AT - Income TaxIncome accrued and arise u/s.5(2) read with section 9(1)(i) - actual freight beneficiary of the vessel - DTAA - Held that:- Appellant has proved the place of effective control and management of the appellant by furnishing several documents including declaration by director of company that it is completely 100% owned by Mr. Jens Faber Anderson, Copy of Passport of Director to prove that the nationality of director and company has been operating from Denmark. It can be concluded that the Director Mr. Jens Faber Anderson resides in Denmark is resident of Denmark and have been operating business wholly from Denmark, all the important decisions are taken from Denmark in the form of meeting and therefore, the place of effective management and control is Denmark only. The principal company is also engaged in international traffic and residence is Denmark. Therefore, on the basis of Article 9 of the DTAA between India and Denmark, the income on account of operation of ship in International Traffic shall be taxable in the state in which the place of effective management is situated i.e. in this case Denmark. Therefore, in view of the above discussion and considering Article-9 of the Treaty between India and Denmark and also the decision taken by the Department in earlier cases of the assessee, we hold that the ships operated in International Traffic and therefore, the income from ship shall not be taxed in India as per Article 9 of the Treaty. Therefore, on account of foregoing observation, appeal of the assessee/appellant is allowed.
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