Modified Agreement for Avoidance of Double Taxation between India and Japan - 0671(E) - Income Tax

Modified Agreement for Avoidance of Double Taxation between India and Japan Notification No. 0671(E) Dated 30/11/1974 Whereas the Government of India and the Government of Japan have concluded and Agreement through exchange of Notes as set out in the Annexure hereto, for modifying the Agreement between India and Japan for the avoidance of double taxation in respect of taxes on income signed at New Delhi on the 5th day of January, 1960, as modified and supplemented by the Protocol signed at New Delhi on the 8th day of April, 1969; Now, therefore, in exercise of the powers conferred by section 90 of the Income-tax Act, 1961 (43 of 1961), and section 24A of the Companies (Profits) Surtax Act, 1964 (7 of 1964), the Central Government hereby directs that all the provisions of the said Agreement shall be given effect to in the Union of India. ANNEXURE New Delhi, 30th November, 1974. Excellency, I have the honour to refer to article XII of the Agreement between India and Japan for the Avoidance of Double Taxation in respect of Taxes on Income signed at New Delhi on January 5, 1960 (hereinafter referred to as " the Agreement "), and to Article VIII, paragraph 3 of the Protocol Modifying and Supplementing the Agreement signed at New Delhi on April 8, 1969 (hereinafter referred to as " the Protocol "), and to confirm, on behalf of the Government of India, the following understandings reached between the representatives of the two Governments: 1. In implementing the provisions of Article XII of the Agreement, it is understood that: (1) The competent authorities of the Contracting States shall exchange such information including documents (hereinafter referred to as " information ") as is necessary for carrying out the provisions of the Agreement including information for the prevention or detection of evasion or avoidance of the taxes which are the subject of the Agreement. Any information so exchanged shall be treated as secret but may be disclosed to persons (including a court or administrative body) concerned with the assessment, collection, enforcement or prosecution in respect of the taxes which are the subject of the Agreement or to persons with respect to whom the information relates. (2) The exchange of information shall be either on a routine basis or on request with reference to particular cases. The competent authorities of the Contracting States shall agree from time to time on the list of information which shall be furnished on a routine basis. (3) In no case shall the provisions of paragraph (1) above be construed so as to impose on one of the Contracting States the obligation: (a) to carry out administrative measures at variance with the laws or the administrative practice of that or of the other Contracting State; (b) to supply information which is not obtainable under the laws or in the normal course of the administration of that or of the other Contracting State; (c) to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information, the disclosure of which would be contrary to public policy. 2. With reference to Article VIII, paragraph 3 of the Protocol: The provisions of paragraph 1 of Article IV of the Protocol shall continue to be applicable: (i) on the part of India, in respect of the assessment year commencing on the 1st day of April, 1972, and the subsequent four assessment years; and (ii) on the part of Japan, in respect of any taxable year beginning between the 1st day of January, 1971, and the 31st day of December, 1975. I have further the honour to propose that this Note and Your Excellency's Note in reply confirming the foregoing understandings shall be regarded as constituting an agreement between the two Governments, which will enter into force on the date of Your Excellency's reply and remain in force as long as the Agreement and the Protocol remain in force. I avail myself of this opportunity to renew to Your Excellency the assurances of my highest consideration. (Sd.) H. N. RAY, Secretary to the Government of India. His Excellency Mr. Kinya Niiseki, Ambassador Extraordinary and Plenipotentiary of Japan to India. New Delhi, 30th November, 1974. Excellency, I have the honour to acknowledge the receipt of Your Excellency's Note of today's date which reads as follows: " I have the honour to refer to Article XII of the Agreement between India and Japan for the Avoidance of Double Taxation in respect of Taxes on Income signed at New Delhi on January 5, 1960 (hereinafter referred to as " the Agreement "), and to Article VIII, paragraph 3 of the Protocol Modifying and Supplementing the Agreement signed at New Delhi on April 8, 1969 (hereinafter referred to as " the Protocol "), and to confirm, on behalf of the Government of India, the following understandings reached between the representatives of the two Governments: 1. In implementing the provisions of Article XII of the Agreement, it is understood that: (1) The competent authorities of the Contracting States shall exchange such information including documents (hereinafter referred to as " information ") as is necessary for carrying out the provisions of the Agreement, including information for the prevention or detection of evasion or avoidance of the taxes which are the subject of the Agreement. Any information so exchanged shall be treated as secret but may be disclosed to persons (including a court or administrative body) concerned with the assessment, collection, enforcement or prosecution in respect of the taxes which are the subject of the Agreement or to persons with respect to whom the information relates. (2) The exchange of information shall be either on a routine basis or on request with reference to particular cases. The competent authorities of the Contracting States shall agree from time to time on the list of information which shall be furnished on a routine basis. (3) In no case shall the provisions of paragraph (1) above be construed so as to impose on one of the Contracting States the obligation: (a) to carry out administrative measures at variance with the laws or the administrative practice of that or of the other Contracting State; (b) to supply information which is not obtainable under the laws or in the normal course of the administration of that or of the other Contracting State; (c) to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information, the disclosure of which would be contrary to public policy. 2. With reference to Article VIII, paragraph 3 of the Protocol: The provisions of paragraph 1 of Article IV of the Protocol shall continue to be applicable: (i) on the part of India, in respect of the assessment year commencing on the 1st day of April, 1972, and the subsequent four assessment years; and (ii) on the part of Japan, in respect of any taxable year beginning between the 1st day of January, 1971, and the 31st day of December, 1975. I have further the honour to propose that this Note and Your Excellency's Note in reply confirming the foregoing understandings shall be regarded as constituting an agreement between the two Governments, which will enter into force on the date of Your Excellency's reply and remain in force as long as the Agreement and the Protocol remain in force. " I have further the honour to confirm the foregoing understandings on behalf of the Government of Japan and to agree that Your Excellency's Note and this note shall be regarded as constituting an agreement between the two Governments which will enter into force on the date of this reply and remain in force as long as the Agreement and the Protocol remain in force. I avail myself of this opportunity to renew to Your Excellency the assurances of my highest consideration. (Sd.) KINYA NIISEKI, Ambassador Extraordinary and Plenipotentiary of Japan to India. Mr. H. N. Ray, Secretary to the Government of India, Ministry of Finance.