TMI BlogTerminationX X X X Extracts X X X X X X X X Extracts X X X X ..... mination is given ; (ii) in respect of capital which is held on the last day of any fiscal year beginning on or after the first day of April following the calendar year in which the notice of termination is given. In witness whereof the undersigned being duly authorised thereto, have signed the present Agreement. Done at Bonn on June 19th, 1995 in two originals, each in the German, Hindi and English languages, all three texts being authentic. In case of divergent interpretation of the German and the Hindi texts, the English text shall prevail. Protocol The Republic of India and the Federal Republic of Germany have agreed at the signing at Bonn on 19th June, 1995 of the Agreement between the two States for the avoidance of double taxation with respect to taxes on income and capital upon the following provisions which shall form an integral part of the said Agreement. With reference to Article 7 1. (a) In the determination of the profits of a building site or construction, assembly or installation project there shall be attributed to that permanent establishment in the Contracting State in which the permanent establishment is situated only the profits resulting fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... containers) in connection with the transport of goods or merchandise in international traffic. With reference to Article 10 3. For the purpose of taxation in the Federal Republic of Germany, the term dividends includes income derived by a sleeping partner (stiller Gesellschafter) from his participation as such and distributions on certificates of an investment fund or investment trust. For the purpose of taxation in the Republic of India, any income of a similar kind will be treated alike. With reference to Articles 10 and 11 4. Notwithstanding the provisions of these Articles, dividends and interest may be taxed in the Contracting State in which they arise, and according to the law of that State, (a) if they are derived from rights or debt claims carrying a right to participate in profits (including income derived by a sleeping partner from his participation as such, from a partiarisches Darlehen and from Gewinnobligationen within the meaning of the tax law of the Federal Republic of Germany) and (b) under the condition that they are deductible in the determination of profits of the debtor of such income. With reference to Article 13 5. In view of the positi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the characterisation of that income by the Federal Republic of Germany. A notification made under this paragraph shall have effect only from the first day of the calendar year following the year in which it was transmitted and any legal prerequisites under the domestic law of the notifying State for giving it effect have been fulfilled. With reference to Article 26 7. (a) It is also understood that in relation to the Agreement, the term information shall include documents. It is further understood that the German tax law provides for the transmission of information in terms of paragraph 3 of Article 117 of the Fiscal Code (Abgabenordnung) - upon request - and it would be possible to furnish information to the competent authority in the Republic of India under these provisions irrespective of this Article. (b) If personal data is exchanged under this Article, the following additional provisions shall apply subject to the domestic laws of each Contracting State : (i) The data supplying Contracting States shall be responsible for the accuracy of the data they supply. If it emerges that inaccurate data or data which should not have been supplied have been communicated, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... epublic of Germany and India - CIT v.Visakhapatnam Port Trust [1983] 144 ITR 146 (AP). n Where supplier of machinery had a permanent establishment in Germany where press was manufactured and certain services were rendered in connection with setting up of that press in India, this could not be treated as personal service in any way even if agreement for rendering service was embodied in a separate agreement; as such in view of agreement for avoidance of double taxation between Germany and India, tax was not deductible at source from amount paid to German company for such services - Andrew Yule Co. Ltd. v. CIT [1994] 207 ITR 899 (Cal.). n Fees for technical services is industrial or commercial profit and, therefore, would be entitled to exemption as per article III of DTA between India and Germany - AEG Telefunken v. CIT [1998] 233 ITR 129/101 Taxman 109 (Kar.). n In case of a non-resident, who is a resident of Germany, income arising to him in India by way of royalties or technical charges could be taxed in IndiaDy. CIT v. UHDE GmbH [1996] 54 TTJ (Bom. - Trib.) 355. n Expression laws in force occurring in Article XVI, para 1 of Agreement for Avoidance of Double Taxation be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A does not provide that any receipt, which does not fall in any of the clauses, would be taxable under the Income-tax Act or would be excluded from the purview of Indian taxationG.U.J. Jaeger GmbH v. ITO [1991] 37 ITD 64 (Bom. - Trib.). n The contention that the consideration pertaining to the provision of recurring know-how would also be a part of industrial and commercial profits has no force. It would be in the nature of royalty and there being a specific exclusion of royalty from the definition of industrial and commercial profits, by Article III(3) of DTA, it would not enjoy the exemption on the ground that the assessee had no permanent establishment in IndiaG.U.J. Jaeger GmbH v. ITO [1991] 37 ITD 64 (Bom. - Trib.). n Rendering of consultancy service in India by non-resident in connection with industrial project would not amount to doing industrial or commercial activity within meaning of Double Taxation Avoidance Agreement between Federal Republic of Germany and India so as to make section 195 inapplicable to payments made by assessee to non-residentGujarat Narmada Valley Fertilisers Co. Ltd. v. ITO [1982] 2 ITD 515 (Ahd.). n Under no circumstances executive authority c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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