TMI BlogU/s 90 of the IT Act, 1961 - Double Taxation Agreement - Amendment of Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with foreign countries - Swiss Confederation.X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the said Protocol shall have effect in India in respect of income arising in any fiscal year beginning on or after the first day of April next following the calendar year in which the Amending Protocol entered into force; And whereas Paragraph 3 of Article 14 of the said protocol provides that with respect to Article 26 of the Agreement, the exchange of information provided for in the said Protocol will be applicable for information that relates to any fiscal year beginning on or after the first day of January of the year next following the date of signature of the said Protocol; Now, therefore, in exercise of the powers conferred by section 90 of the Income-tax Act, 1961 (43 of 1961) , the Central Government hereby directs that all the provisions of the said Protocol, as set out in the Annexure hereto, shall be given effect to in the Union of India in respect of income arising in any fiscal year beginning on or after the 1st day of April, 2012 and with respect to Article 26 of the Agreement, the exchange of information provided for in the said Protocol will be applicable for information that relates to any fiscal year beginning on or after the 1st day of April, 2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te and paid to a resident of the other Contracting State engaged in the operation of ships or aircraft in international traffic shall be taxable only in that other State to the extent that such interest is paid on funds connected with such activity;" Article 5 : Paragraph 3 of Article 13 (Capital gains) of the Agreement shall be deleted and replaced by the following paragraph: " 3 . Gains derived by an enterprise of a Contracting State from the alienation of ships or aircraft operated in international traffic, or movable property pertaining to the operation of such ships or aircraft shall be taxable only in that State " Article 6 : Sub-paragraph ( c ) of paragraph 2 of Article 23 (Elimination of double taxation) of the Agreement shall be deleted. Article 7 : Paragraph 2 of Article 24 (Non-discrimination) of the Agreement shall be deleted and replaced by the following paragraph: " 2 . The taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same activities. This provision sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... c policy (ordre public). 4 . If information is requested by a Contracting State in accordance with this Article, the other Contracting State shall use its information gathering measures to obtain the requested information, even though that other State may not need such information for its own tax purposes. The obligation contained in the preceding sentence is subject to the limitations of paragraph 3 but in no case shall such limitations be construed to permit a Contracting State to decline to supply information solely because it has no domestic interest in such information. 5 . In no case shall the provisions of paragraph 3 be construed to permit a Contracting State to decline to supply information solely because the information is held by a bank, other financial institution, nominee or person acting in an agency or a fiduciary capacity or because it relates to ownership interests in a person. In order to obtain such information, the tax authorities of the requested Contracting State shall, therefore, have the power to enforce the disclosure of information covered by this paragraph, notwithstanding paragraph 3 or any contrary provisions in its domestic laws." Articl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ocol between India and a third State which is a member of the OECD signed after the signature of this Amending Protocol, India limits its taxation at source on dividends, interest, royalties or fees for technical services to a rate lower than the rate provided for in this Agreement on the said items of income, the same rate as provided for in that Convention, Agreement or Protocol on the said items of income shall also apply between both Contracting States under this Agreement as from the date on which such Convention, Agreement or Protocol enters into force. If after the date of signature this Amending Protocol, India under any Convention, Agreement or Protocol with a third State which is a member of the OECD, restricts the scope in respect of royalties or fees for technical services than the scope for these items of income provided for in Article 12 of this Agreement, then Switzerland and India shall enter into negotiations without undue delay in order to provide the same treatment to Switzerland as that provided to the third State." Article 12 : Paragraph 7 of the Protocol to the Agreement (With reference to paragraph 4 of Article 24) shall be deleted and replaced by the f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fairs of a given taxpayer. While clause ( b ) of paragraph 10 contains important procedural requirements that are intended to ensure that fishing expeditions do not occur, sub-clauses ( i ) through ( v ) nevertheless need to be interpreted in order not to frustrate effective exchange of information. ( e ) It is further understood that Article 26 of the Agreement shall not commit the Contracting States to exchange information on an automatic or a spontaneous basis. ( f ) It is understood that in case of an exchange of information, the administrative procedural rules regarding taxpayers' rights provided for in the requested Contracting State remain applicable before the information is transmitted to the requesting Contracting State. It is further understood that this provision aims at guaranteeing the taxpayer a fair procedure and not at preventing or unduly delaying the exchange of information process." Article 14 : 1 . The Governments of the Contracting States shall notify each other through diplomatic channels that all legal requirements and procedures for giving effect to this Amending Protocol have been satisfied. 2 . The Amending Protocol, which shall form an int ..... X X X X Extracts X X X X X X X X Extracts X X X X
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