An assessee to whom the agreement applies has the option of being subjected to tax as per DTAA or the Income-tax Act 1961, which is more beneficial to it. When section 44D is read in juxtaposition to section 115A, it mandates for putting the amount of royalty and fees for technical services to tax at 20% as against 10% as provided by Article 12 of DTAA. The assessee being a person to whom the agreement applies, has rightly subjected itself to taxation at the reduced rate of 10% as per DTAA.
IN THE INCOME T AX APPELLATE TRIBUNAL
MUMBAI BENCHES “L”, MUMBAI
ITA No.4633/Mum/2006
Asst. Year 2002-2003
| The Asstt. Director of Income-tax International Taxation – 1(2) Mumbai. |
Vs. |
M/s. Chiron Behring GmbH & Co. C/o. Chiron Behring Vaccines Pvt. Ltd
501Shree Amba Shanti Ahcmbcrs. Opp. The Leela, Andheri Kurla Road Andheri (East) Mumbai-400059 PA No. AABCC7831M. |
|---|---|---|
|
Appellant |
Respondent |
Appellant by: Shri Manvendra Goyal
Respondent by: Shri F.V. Irani
O R D E R
This appeal by the Revenue is directed against the order passed by the Commissioner of Income-tax (Appeals) on 15.5.2006 in relation to the assessment year 2001-2002.
2. First two grounds are against the direction given by the learned CIT(A) for applying the beneficial rate of tax as provided under DTAA as the assessee is liable to tax in Germany.
