TMI Blog2018 (12) TMI 1341X X X X Extracts X X X X X X X X Extracts X X X X ..... arts with a non-obstance clause? - tax liability on the payee at a lower rate as per Double Taxation Avoidance Agreement (DTAAs) - Held that:- We notice that identical situation had came before the Delhi High Court in case of Danisco India Pvt Ltd Vs. Union of India & Ors [2018 (2) TMI 1289 - DELHI HIGH COURT] having regard to the position of law explained in Azadi Bachao Andolan (2003 (10) TMI 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh for the Appellant Mr. Atul Jasani for the Respondent P.C.: 1. Revenue is in the appeal against the judgment of the Income Tax Appellate Tribunal ( the Tribunal for short) dated 30.3.2015. Since the facts are identical, we may refer from Income Tax Appeal No. 548 of 2016. Following question was presented for our consideration:- (i) Whether the Tribunal was correct in law a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l. The Tribunal, by the impugned judgment, held that there was tax liability on the payee at a lower rate as per Double Taxation Avoidance Agreement (DTAAs) and therefore, by virtue of Section 90(2) of the Act, the assessee was spared the liability to deduct tax at higher rate in terms of the provisions of Section 206AA of the Act. 3. Having heard the learned counsel for the parties and having ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent is mitigating to a large extent, the rigors of the preexisting laws. The law, as it existed, went beyond the provisions of DTAA which in most cases mandates a 10% cap on the rate of tax applicable to the state parties. Section 206AA (prior to its amendment) resulted in a situation, where, over and above the mandated 10%, a recovery of an additional 10%, in the event, the non- resident payee, d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e issue before the Delhi High Court arose in the context of Writ Petition filed by the assessee, however, the background and the relevant facts were identical. Even the Revenue does not dispute this aspect. We are in agreement with the view expressed by the Delhi High Court. In view of the detailed discussion in the said judgment and also the judgment of the Tribunal in the impugned judgment, it i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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