Domestic company paying dividend tax not entitled to DTAA benefits.

The ITAT ruled that a domestic company paying dividends to non-resident shareholders must pay the Additional Income-tax under Section 115-O at the specified rate, not the rate applicable to non-resident shareholders under a DTAA. The tribunal noted that treaty benefits for dividend distribution tax are only available if the Contracting States explicitly intend to provide such protection. Consequently, the domestic company cannot automatically claim DTAA benefits for dividend tax, and the decision was unfavorable to the assessee. .....

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