No Tax on Capital Gain earned by Singapore-Company on Sale of Debt Instrument in India under Article 13(4) of DTAA

Brief facts of the case are that the assessee is tax resident of Singapore and registered as Foreign Institutional Investor (FII) in Debt segment, with Security and Exchange Board of India (SEBI). The assessee filed return of income on 30.09.2009 declaring total income of Rs. 33,99,75,350/-. In the return the assessee declared a Capital Gain of Rs. 86,62,63,158/- on sale of debt instruments and claimed exemption under Article 13(4) of India-Singapore Double Taxation Avoidance Agreement (DTAA or Treaty). During the assessment the assessing officer asked the assessee to explain as to how the pro...