Circular No. 116-Income Tax dated 10-7-1973

1. In exercise of the powers available under section 49A of the 1922 Act, the  Government of India had issued a Notification dated 23-6-1956 called the Income-tax (Double Taxation Relief) (Dominions) Rules, 1956 [Annex], providing for grant of relief in respect of income on which tax has been paid both in India and in any of the following Dominions:

These rules being consistent with the corresponding provisions of the 1961 Act continued to be operative by virtue of the provi­sions contained in section 297(2)(k).

2. The following countries have, however, stated that the agreements on the basis of which the said rules were applicable are no longer binding on them after the date of their attainment of independence as shown against each:

Thus, there is no subsisting agreement, between India and the above-named four countries for the avoidance of double taxation of income after the dates shown above. The cases of Indian residents will, therefore, be covered by the provision for grant of unilateral relief under section 91. This will be applicable in respect of the  assessment years commencing from the assessment year immediately following the financial year in which a particular country attained independence. Thus, the provision for unilateral relief will become applicable in case of income in these countries for and from the assessment year as indicated below:

3. The Government of Sierra Leone has informed that it has no objection in principle to continue the arrangements with India as contained in the Income-tax (Double Taxation Relief)(Dominions) Rules, 1956. Hence, the said rules will continue to remain in force in relation to Sierra Leone.

4. The position in respect of the remaining countries, viz., Gold Coast, Nigeria and Mauritius is being ascertained.

Circular : No. 116 [ F. No. 145/32-FTD], dated 10-7-1973.