TMI Blog2021 (8) TMI 920X X X X Extracts X X X X X X X X Extracts X X X X ..... , for the reason, that the assessee had failed to substantiate that the interest income in question was offered by him for tax in his return of income filed in U.S.A. As observed by us hereinabove, the very basis of rejection of the assessee s claim for applying of special rate of tax as per the India-USA DTAA by the A.O is absolutely misconceived and in fact misplaced. As stated by the A.R rightly that the assessee was not seeking credit of taxes paid on his income abroad, but was seeking taxing of his interest income as per the special rates on the basis of the India-USA DTAA. Considering the fact that the assessee had filed the TRC with the A.O though after the conclusion of the assessment, coupled with the reasons that had led to delay in obtaining of the same alongwith the Form 10F, we are unable to persuade ourselves to the summarily rejection or in fact discarding of the same by the CIT(A). As the assessee had filed the TRC and Form 10F, therefore, there was no justification in declining the applying of the special rate of tax qua the interest income on fixed deposits bank interest amounting to ₹ 17,87,709/- @10% and 15% that was claimed by him on the basis of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x Residency Certificate, dated 30.01.2017 (TRC); and (ii). Form 10F, dated 07.05.2019. The A.O vide his remand report objected to the admission of the aforesaid additional evidence. Rebutting, the objection of the A.O, the assessee demonstrated the reasons that had led to failure on his part to file the aforesaid documents in the course of the assessment proceedings. After deliberating on the assessee s claim for allowing of the beneficial provisions of India-USA DTAA, it was observed by the CIT(A) that for claiming the benefits of a DTAA an assessee is required to obtain a TRC and also file information in Form 10F. It was further observed by him that the benefit under the DTAA has to be claimed by an assessee in the return of income itself. Also, the CIT(A) was of the view that as Rule 21AB(2A) of the Income-tax Rules, 1962 casts an obligation on the assessee to maintain such documents and furnish the same to the A.O, therefore, the said information ought to have been available with the assessee at the time of filing of the return of income itself. The CIT(A) observed that the assessee had not obtained the TRC before filing the return of income and had not filed the same in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lined to apply the special rate of tax qua the interest income of the assessee, for the reason, that the assessee had failed to substantiate that the interest income in question was offered for tax in his return of income filed in U.S.A. On the contrary, the CIT(A) had concluded that the assessee having failed to file the TRC and Form 10F with the A.O, thus, could not have sought exigibility to tax of the interest income on fixed deposits bank interest amounting to ₹ 17,87,709/- @10% and 15% on the basis of the India-USA DTAA. Before adverting to the sustainability of the view taken by the lower authorities, we shall briefly cull out the relevant statutory provisions which would have a bearing on the adjudication of the issue in question. Sub-sections (1), (4) and (5) to Section 90 of the Act reads as under : (1) The Central Government may enter into an agreement with the Government of any country outside India or specified territory outside India,- (a) for the granting of relief in respect of- (i) . .. . (ii) income-tax chargeable under this Act and under the corresponding law in force in that country or specif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2A), the same reads as under: Certificate for claiming relief under an agreement referred to in section 90 and 90A. (1) Subject to the provisions of sub-rule (2), for the purposes of sub-section (5) of section 90 and sub-section (5) of section 90A, the following information shall be provided by an assessee in Form No. 10F, namely:- (i) Status (individual, company, firm etc.) of the assessee; (ii) Nationality (in case of an individual) or country or specified territory of incorporation or registration (in case of others); (iii) Assessee's tax identification number in the country or specified territory of residence and in case there is no such number, then, a unique number on the basis of which the person is identified by the Government of the country or the specified territory of which the asseessee claims to be a resident; (iv) Period for which the residential status, as mentioned in the certificate referred to in sub-section (4) of section 90 or sub-section (4) of section 90A, is applicable; and (v) Address of the assessee in the country or specified territory outside India, during the period for which the certificate, as mentioned in (iv) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial rates of tax on the interest income of the assessee as per the India-USA tax treaty. 9. We have deliberated at length qua the issue under consideration and are unable to persuade ourselves to accept the view taken by the lower authorities. As is discernible from the order passed by the CIT(A), the assesee could not furnish the TRC in the course of the assessment proceedings because of paucity of time, which reasons were explained at length by him before the CIT(A), as under: (i). The ld. ITO asked for TRC for the first time on 21st December, 2016, requiring assessee to furnish TRC in two days before 23.12.2016. This was an impractical requirement. (ii). It took assessee almost four weeks to obtain TRC from USA tax authorities. He applied on 03.01.2017 and got it on 30.01.2017. He could not apply earlier for reasons explained below. (iii). When the ld. ITO demanded the TRC the assessee was in India on pilgrimage. Hence, it was too short a time for him to coordinate with his CPA and USA tax authorities. This was communicated with ld. ITO on 23.12.2010. (iv). Assessee wanted to contact his CPA in USA to explore the possibility for getting TRC within time ..... X X X X Extracts X X X X X X X X Extracts X X X X
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