TMI Blog2018 (2) TMI 513X X X X Extracts X X X X X X X X Extracts X X X X ..... to be issued by the Government of India to enforce such later Treaty between India – Finland in the present case. The Protocol clause quoted above in the India- Netherlands DTAA itself provide for such automatic application of subsequent Treaty, to the India–Netherlands Treaty in hand and therefore, no such separate Notification was envisaged to be issued for enforcing such subsequent Treaty with another OECD country, viz., Finland, to be made applicable to the facts of the present case. The two reasons assigned by CIT (IT) in the impugned order, are no longer sustainable and therefore, the impugned order cannot be sustained in the eye of law. - Decided in favour of assessee - W.P.No. 31738 OF 2016 (T-IT) & W.P.No.32301 OF 2016 c/w W.P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Taxation), Kochi. 3. The relevant extract of the order passed by the respondent-Commissioner of Income Tax, which is impugned in the present petition Annexure-A dated 30.3.2016 is quoted below for ready reference:- The rival arguments and submissions have been examined and the following conclusions are reached: 1. There is no final or binding ruling on the issue of the necessity of a notification to give effect to MFN clause whenever any subsequent treaty with more restricted scope is entered into by India. The Steria decision may have been stayed for the time being, but it is not reversed. The stay order of the Honourable High Court contains no discussion on the merits of the case. Also the decision of ITAT has not become fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of Steria (India) Ltd. on 28.7.2016, reported in [2016] 386 ITR 390 (Delhi). The relevant extract of the said judgment is also quoted below for ready reference:- 16. The Authority for Advance Rulings appears to have failed to notice that wording of clause 7 of the Protocol makes it self- operational. It is not in dispute that the India- France Double Taxation Avoidance Agreement was itself notified by the Central Government by issuing a notification under section 90 of the Act. It is also not in dispute the separate Protocol signed between India and France simultaneously forms an integral part of the Convention itself. The preamble in the Protocol, which states the undersigned have agreed on the following provisions which shall f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India-France Double Taxation Avoidance Agreement. 5. Mr.Ajay Vora also drew the attention of the Court towards Ad Article 12 of the said India Netherlands Treaty , which, by its Protocol, provide as under:- V. Ad Article 12 It is understood that in case India applies a levy, not being a levy covered by Article 2, such as the Research and Development Cess, on payments meant in Article 12, and if after the signature of this Convention under any Convention or Agreement between India and a third State which is a member of the OECD India should give relief from such levy, directly, by reducing the rate or the scope of the levy, either in full or in part, or, indirectly, by reducing the rate or the scope of the Indian tax allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty is used or the services are performed. Where, however, the person paying the royalties or fees for technical services, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the royalties or fees for technical services was incurred, and such royalties or fees for technical services are borne by such permanent establishment or fixed base, then such royalties or fees for technical services shall be deemed to arise in the State in which the permanent establishment or fixed base is situated. 7. Therefore, the learned Senior Counsel for the petitioner urged that the orders passed by the Assessing Authority Deputy Commi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erves to be set aside. 11. As far as the issue of there being a requirement of issuing a separate Notification for enforcing the later Treaty with another OECD country, viz., Finland, in the present case is concerned, this Court does not find any justification in the contentions raised on behalf of the Revenue, that such a Notification was required to be issued by the Government of India to enforce such later Treaty between India Finland in the present case. The Protocol clause quoted above in the India- Netherlands DTAA itself provide for such automatic application of subsequent Treaty, to the India Netherlands Treaty in hand and therefore, no such separate Notification was envisaged to be issued for enforcing such subsequent Treaty w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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