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2023 (4) TMI 967 - AT - Income TaxTaxability of interest income on external commercial borrowings - Indo Netherlands Tax Treaty - What will be tax rate to be applied as per Indo Netherlands Tax Treaty? - DR argued that the said interest income would become business profit of the Indian branch and hence to be taxed in terms of Article 7 of the Indo Netherlands Tax Treaty - HELD THAT:- As perusal of Indo Netherlands Tax Treaty that there is a separate Article provided for taxability of Interest vide Article 11 thereon. There is no dispute that the nature of income that is sought to be taxed is interest income in the instant case. Hence, it would be just and fair to apply the Article 11(2) for the purpose of determining the taxability of the said interest income. Hence, in view of Article 11(2), we direct the Ld. AO to bring to tax interest income @10%. Accordingly, the grounds raised by the Revenue are dismissed.
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