Law:

Section:

Section 90 of the Income-tax Act, 1961, read with article 16 of the Double Taxation Avoidance Agreement between India and United Kingdom - Double taxation relief - Where agreement exists (Dependant personal services) - Assessment year 2001-02 - Assessee was an employee of a British company and was working in its London office - He also worked in India for some days in subsidiary of British company for which salary was paid by Indian company on behalf of British company - He claimed that portion of salary paid in India by a foreign employer could not brought to tax under article 16(2) of DTAA with UK - Whether since salary was paid by Indian company treating assessee as its employee though it might have recovered same from British company, condition stipulated in article 16(2)(b) was not fulfilled and, therefore, assessee was not eligible for exemption under article 16 - Held, yes FACTS The assessee was an employee of a British company, and was working in its London office. He had also worked in India for some days in the subsidiary of the British company and salary for that period was paid to him by the Indian company in India on behalf of the British company. The assessee claimed that portion of salary paid in India by a foreign employer could not be brought to tax under article 16(2) of the DTAA between India and UK. The Assessing Officer disallowed the exemption holding that the conditions stipulated in article 16 were not fulfilled by the assessee. On appeal, the Commissioner (Appeals) confirmed the order of the Assessing Officer. On second appeal, the Tribunal deleted the addition. On the revenue's appeal to the High Court: HELD Article 16 of the DTAA makes it clear that if the remuneration is received by a resident of the contracting State in respect of employment exercised in the other contracting State, then such remuneration is not subjected to tax in that State, if his stay does not exceed 183 days and remuneration is paid by the employer, who is not also a resident of the other State and the remuneration is not tax deductible from the profits chargeable to tax in that State. [Para 6] Though there was some dispute initially with regard to the first…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492