Case Law Details
Brief : Article 26(3) of the India-USA DTAA protects the interest of non residents vis-a-vis residents. Article 26(3) provides that payment made to a non-resident will be deductible under the same conditions as if the payment were made to a resident. The exceptions provided in Article 26(3) are not applicable on facts. As per s. 40(a)(i), no dis allowance can be made in respect of payments to residents on the ground of non-deduction of tax at source. Therefore, in view of Article 26(3), no dis allowance can be made even in case of payments to non-residents even if the amount is found taxable in India in their hands. Herbal Life International 101 ITD 450 (Del) followed.
Citation : Central Bank of India V/s. The Dy. CIT Special Range 27
ITA No. 4155/M/2003 -Assessment Year 1997- 98, ITA No.4156/M/2003- Assessment Year 1998- 99, ITA No. 4157/M/2003- Assessment Year 1999- 2000
Court : ITAT Mumbai
ORDER
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