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TMI BlogAgreement between the Government of the Republic of India and the Government of the People’s Republic of China for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxesX X X X Extracts X X X X X X X X Extracts X X X X ..... paragraph 2 of Article 13 of the said amending Protocol; And whereas, sub-paragraph (b) of paragraph 3 of Article 13 of the said amending Protocol provides that the provisions of the said amending Protocol shall have effect in India in respect of income derived in any fiscal year beginning on or after the first day of April following the calendar year in which this Protocol enters into force; Now, therefore, in exercise of the powers conferred by sub-section (1) of section 90 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies that all the provisions of the said amending Protocol, as annexed hereto, shall have effect in the Union of India. ANNEXURE PROTOCOL AMENDING THE AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME AND THE PROTOCOL THERETO SIGNED AT NEW DELHI ON 18TH JULY, 1994 The Government of the Republic of India and the Government of the People's Republic of China, Desiring to amend the Agreement between the Government of the Republic of India and the Government of the Peopl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dent) of the Agreement shall be replaced by the following: "3. Where by reason of the provisions of paragraph 1, a person other than an individual is a resident of both Contracting States, the competent authorities of the Contracting States shall endeavour to determine by mutual agreement the Contracting State of which such person shall be deemed to be a resident for the purposes of the Agreement, having regard to its place of effective management, the place where it is incorporated or otherwise constituted and any other relevant factors. In the absence of such agreement, such person shall not be entitled to any relief or exemption from tax provided by this Agreement except to the extent and in such manner as may be agreed upon by the competent authorities of the Contracting States." Article 6 Article 5 (Permanent Establishment) of the Agreement shall be replaced by the following: "ARTICLE 5 PERMANENT ESTABLISHMENT 1. For the purposes of this Agreement, the term "permanent establishment" means a fixed place of business through which the business of an enterprise is wholly or partly carried on. 2. The term "permanent establishment" includes especially: (a) a place of manag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the enterprise; (b) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of storage or display; (c) the maintenance of a stock of goods or merchandise belonging to the enterprise solely for the purpose of processing by another enterprise; (d) the maintenance of a fixed place of business solely for the purpose of purchasing goods or merchandise or of collecting information, for the enterprise; (e) the maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity of a preparatory or auxiliary character. 5. Notwithstanding the provisions of paragraphs 1 and 2 but subject to the provisions of paragraph 6, where a person is acting in a Contracting State on behalf of an enterprise of the other Contracting State and, in doing so, (a) habitually concludes contracts, or habitually plays the principal role leading to the conclusion of contracts that are routinely concluded without material modification by the enterprise, and these contracts are (i) in the name of the enterprise, or (ii) for the transfer of the ownership of, or for the granting of the right to use, propert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess in that other State (whether through a permanent establishment or otherwise), shall not of itself constitute either company a permanent establishment of the other." Article 7 Paragraph 1 of Article 7 (Business Profits) of the Agreement shall be replaced by the following: "1. The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other Contracting State, but only so much of them as is attributable to that permanent establishment." Article 8 Paragraph 3 of Article 11 (Interest) shall be replaced by the following: "3. Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State and paid to the Government, a political subdivision or a local authority, the Central Bank or any financial institution wholly owned by the Government of the other Contracting State, or paid on loans guaranteed or insured by the Government, a political subdivision or a local authority, the Central Bank or any financial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s information obtained under the domestic laws of that State and shall be disclosed only to persons or authorities (including courts and administrative bodies) concerned with the assessment or collection of, the enforcement or prosecution in respect of, the determination of appeals in relation to the taxes referred to in paragraph 1, or the oversight of the above. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions. Notwithstanding the foregoing, information received by a Contracting State may be used for other purposes when such information may be used for such other purposes under the laws of both States and the competent authority of the supplying State authorises such use. 3. In no case shall the provisions of paragraphs 1 and 2 be construed so as to impose on a Contracting State the obligation: (a) to carry out administrative measures at variance with the laws and administrative practice of that or of the other Contracting State; (b) to supply information (including documents) which is not obtainable under the laws or in the normal course of the administration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment Bank of China; (C) the Export-Import Bank of China; (D) the National Council for Social Security Fund; (E) the China Export & Credit Insurance Corporation; (F) the China Investment Corporation; (G) any other institution wholly owned by the Government of China as may be agreed from time to time between the competent authorities of the Contracting States; (ii) in the case of India: (A) the Export-Import Bank of India; (B) the National Housing Bank; (C) the India Infrastructure Finance Company Limited; (D) the Export Credit Guarantee Corporation of India Limited; (E) the National Bank for Agricultural and Rural Development; (F) any other institution wholly owned by the Government of India as may be agreed from time to time between the competent authorities of the Contracting States." Article 13 1. Both Contracting States shall notify each other in writing through diplomatic channels that they have completed the procedures required by the respective laws for the entry into force of this Protocol. 2. This Protocol shall enter into force on the thirtieth day after the date of the later of the notifications referred to in paragraph 1 of this Article. 3. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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