TMI Blog2023 (1) TMI 173X X X X Extracts X X X X X X X X Extracts X X X X ..... isfied in case of assessee? HELD THAT:- It is not in dispute that the assessee has made payment towards technical services to various recipients in different countries as per DTAA with different countries. In the case of Danisco, the Delhi High Court has held that Section 206AA cannot be understood to override the charging Sections 4 and 5 of the Act. It has further held that the provision in Section 206-AA has to be read down to mean that where the deductee i.e., the overseas resident business concern conducts its operation from a territory, whose Government has entered into a Double Taxation Avoidance Agreement with India, the rate of taxation would be as dictated by the provisions of the treaty. Thus, we are in respectful agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no scope for deduction of tax @ 20% under Section 206AA of the Act when the assessing authority has rightly invoked said provision as conditions set out in said provisions are satisfied in case of assessee? 3. At the outset, Shri. R.B.Krishna, learned advocate for the respondent submitted that the assessee has paid fee for technical services to various entities in the four quarters during the assessment year 2011-12. He contended that the Tax Deducted at Source shall be in terms of the relevant Article in respective agreements for Avoidance of Double Taxation in various countries. Adverting to one such agreement with Germany, annexed with the written submission, he pointed out that the rate of tax shall not exceed 10% in the case of Ger ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s further held that the provision in Section 206-AA has to be read down to mean that where the deductee i.e., the overseas resident business concern conducts its operation from a territory, whose Government has entered into a Double Taxation Avoidance Agreement with India, the rate of taxation would be as dictated by the provisions of the treaty. 8. Thus, we are in respectful agreement with the view taken by the Delhi high Court. As per the DTAA, the maximum deduction shall not exceed 10% which the assessee has deducted. Any other interpretation to permit the taxing authority to raise a demand beyond 10% would be incongruous. 9. Shri Aravind, also contended that if the law laid down in Danisco is to be applied, Section 206-AA of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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