Double taxation relief to be extended to agreement between specified associations adopted by CG - Section 90A - International Taxation - Income Tax

Double taxation relief to be extended to agreement between specified associations adopted by CG - Section 90A Section 90A provides that any specified association in India may enter into an agreement with any specified association in the specified territory outside India and Central Government may by notification in Official gazette, make the necessary provisions for adopting and implementing such agreement for- for the granting of relief in respect of- for the avoidance of double taxation of income without creating opportunities for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in the said agreement for the indirect benefit to residents of any other country or territory), or for exchange of information for the prevention of evasion or avoidance of income-tax chargeable under this Act or under the corresponding law in force in that country or specified territory, as the case may be, or investigation of cases of such evasion or avoidance, or for recovery of income-tax under this Act and under the corresponding law in force in that country or specified territory, as the case may be, CG has, vide notification No. 90/2008 dated 28.08.2008, notifies that where an agreement entered into by any specified association in India with any specified association in the specified territory outside India and adopted by the Central Government by way of notification in the Official Gazette, for granting relief of tax, or as the case maybe, avoidance of double taxation, provides that any income of a resident of India may be taxed in the other country, such income shall be included in his total income chargeable to tax in India in accordance with the provisions of the Income-tax Act, 1961, and relief shall be granted in accordance with the method for elimination or avoidance of double taxation provided in such agreement. Provision of Income Tax or DTAA whichever is more beneficial - Where that an agreement may be entered into by any specified association in India with any specified territory outside India which may be adopted by the Central Government by way of notification in the official gazette, for granting relief of tax, or as the case may be, avoidance of double taxation, then, in relation to the assessee to whom such agreement applies, the provisions of this Act shall apply to the extent they are more beneficial to that assessee. However, the provisions of Chapter X-A, General Anti-Avoidance Rule, shall apply to the assessee even if such provisions are not beneficial to him. Meaning of terms used in any DTAA with a foreign country or specified territory. Particulars Meaning of the term 1 Term used in any such agreement, and not defined in the agreement or the Act but assigned a meaning in the notification issued by the CG in the official Gazette, which is still in force The term shall have the meaning assigned in the said notification and the meaning shall be deemed to have effect from the date on which agreement came into force. 2. Term used in any agreement, which is defined in the DTAA itself. The term shall have the same meaning assigned to it in the agreement. 3. Term used in any agreement which is not defined in the said agreement, but defined in the Income Tax Act, 1961. The term shall have the meaning assigned to it in the IT Act, 1961 and explanation, if any, given to it by the CG Tax Residency Certificate Section 90A(4) provides that the non-resident to whom the agreement referred to in section 90A(1) applies, shall not be entitled to claim any relief under such agreement unless a certificate of his being a resident in any country outside India or specified territory outside India, as the case may be, is obtained by him from the Government of that country or specified territory, is furnished declaring his residence of the country outside India or the specified territory outside India, as the case may be. Notes:- A certificate issued by the Government of a foreign country would constitute proof of tax residency without any further conditions regarding furnishing of Prescribed Particulars therein. In addition to such certificate issued by the foreign Government, section 90A(5) requires the assessee to provide such other documents and information, as may be prescribed, for claiming the treaty benefits. The charge of tax in respect of foreign company at a rate higher than the rate at which as domestic company is chargeable, shall not be regarded as less favourable charge or levy of tax in respect of such foreign company For the purposes of this section, the expressions- specified association means any institution, association or body, whether incorporated or not, functioning under any law for the time being in force in India or the laws of the specified territory outside India and which may be notified as such by the Central Government for the purposes of this section; specified territory means any area outside India which may be notified as such by the Central Government for the purposes of this section Documents and Information, to be furnished by the assessee for claiming treaty benefits, prescribed by CBDT vide Notification No. 57/2013 dated 01.08.2013 Status (individual, company, firm etc.) of the assessee; Nationality (in case of an individual) or country or specified territory of incorporation or registration (in case of others); Assessee's tax identification number in the country or specified territory of residence and in case there is no such number, then, a unique number on the basis of which the person is identified by the Government of the country or the specified territory of which the asseessee claims to be a resident; Period for which the residential status, as mentioned in the certificate referred to in section 90(4) section 90A(4), is applicable; and Address of the assessee in the country or specified territory outside India, during the period for which the certificate, as mentioned in (iv) above, is applicable. However, The assessee may not be required to provide the information or any part thereof if the information or the part thereof, as the case may be, is contained in the TRC in section 90(4) section 90A(4). The assessee shall keep and maintain such documents as are necessary to substantiate the information provided. An income-tax authority may require the assessee to provide the said documents in relation to a claim by the said assessee of any relief under an agreement referred to in section 90(4) section 90A(4), as the case may be.