India-Mauritius treaty benefits cannot be denied on the ground that assessee is a subsidiary of a USA Corp

The applicant, a resident of Mauritius, was a subsidiary of a USA company. It received capital contribution and loans from the USA parent which were used to purchase shares in ILFS, an Indian company. On sale of the shares, the applicant earned capital gains which were chargeable to tax under the Act. However, under Article 13 (4) of the India-Mauritius tax treaty, such gains were not chargeable to tax in India. The applicant filed an application for advance ruling on the question whether in view of the said Article 13 (4), the gains were chargeable to tax in India. The department resisted the...