If thin capitalization rules are not in the domestic law/Treaty, there can be not be artificial disallowance of interest paid on borrowings

Court: Mumbai Tribunal

Citation: Besix Kier Dabhol, SA Vs. DDIT

Brief- This is an important decision of the Tribunal, which brings out the importance of a Double Taxation Avoidance Agreement (Treaty), that where thin capitalization rules are not in the domestic law/Treaty, there can be no artificial dis allowance of interest paid on borrowings.

Facts:

Besix Kier, Dabhol (assessee), a company registered under the laws of

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