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Cabinet greenlights extending PMGKAY by 5 years; to cost Rs 11.80 Lakh CroresCabinet approves drone use by women-run SHGs; subsidy included tooCabinet approves Terms of Reference for 16th Fin Com13 killed in bus-train collision in TanzaniaCabinet okays 3-year Central funding extension for fast-track special courtsCabinet ratifies scheme for revamping basic facilities delivery to Particularly Vulnerable Tribal GroupsCostly CommissionersI-T - Purpose of Section 40(a)(ia) is to disincentivize non-deduction of tax at source by disallowing, as deduction, amount paid to resident/payee: HCUnraveling Complexity: MFN Clause and Its Tax Treaty RamificationsI-T - If AO did not have tangible material on record that could have persuaded him to form belief that income otherwise chargeable to tax, had escaped assessment, notice u/s 148 deserves to be quashed: HCCommission for Air Quality Management in NCR revokes Stage-III of GRAP with immediate effectI-T - Time spent by applicant while pursuing review proceedings deserves to be excluded even under principles analogous to Sec 14 of Limitation Act, if he acted in good faith: HCNASA chief calls on MoS, discusses launching joint Satellite with ISROI-T - Since ROI was filed though after search and seized cash was offered by assessee under then prevailing regime, it is to be treated as the advance tax and thus there is no default in payment of advance tax : HCMinistry of Defence inks contract with BHEL for Super Rapid Gun Mount & accessories for Indian NavyCOP28 Panel’s sage advice: ‘Tax the bad’ for climate financeI-T- Since loan received from M/s Godavari is routed through regular banking channel and reflected duly in annual accounts not require addition u/s 68 of Act : ITATUS Embassy issues over 1.4 lakh visas to Indian students in last one yearRozgar Mela: PM to distribute 51,000 appointment letters tomorrowVietnam Parliament approves Global Minimum Tax for corporateI-T- If assessee is corporate entity then ad hoc disallowance of expenditure without pointing out any specific defect is not permissible : ITATTurkey asks UN to prosecute Israel for Gaza crimesST - SVLDRS, 2019 - Only minor variation in the amount proposed in SCN and amount declared in form SVLDRS-1 - Petitioner entitled for relief under the scheme: HCUkraine’s military intelligence head’s wife poisonedGST - SCN is dated 4 th March; reply is to be filed within 30 days but petitioner asked to appear for hearing on 17 th March - Real intention of Department is not to provide fair opportunity to defend their case, but, only to put the petitioner in peril: HCUttarakhand tunnel case - All 41 workers are out; rushed to hospital for routine check-upCus - Since manufacturing activity undertaken and payment of CE was acknowledged and not disputed, same cannot be questioned by Customs department without any clinching evidence that such machine in question was imported into India as such or in un-assembled condition for it to be held liable to ADD: TribunalGovt has received chip-making proposal worth USD 12 billion, says VaishnavST - Activities of screening cargo through x-ray machines and build-up of cargo for loading onboard aircrafts, fall under Cargo Handling Service as well as under Airport Service - However, as per Section 65A of Finance Act 1994, since Section 65(23) occurs before Section 65(105)(zzm) of the Act, both services will be classifiable under Cargo Handling Service : CESTATAnak Krakatau volcano in Indonesia spews 1 km high column of smokes and ashCus - Discrepancies between goods imported and their quantity declaring in packaging list - Appellant, a Customs Broker, permitted freight forwarder to upload packaging list on e-Sanchit portal using Appellant's credentials - this is act of negligence, cannot be punished with forfeiture of brokers' license: CESTAT
 
Tax Treaties - A peep into a New Perspicuous Perspective

The Law And Practice of Tax Treaties - An Indian Perspective (Second Editon)
Authored by Nilesh Modi
Published by CCH, a Wolters Kluwer business
Number of Pages: 1352
Price: Rs 3995/-

Tax Treaties - A peep into a New Perspicuous Perspective

Reviewed by Shailendra Kumar

THE world of International Taxation is as ancient as the history of Independent India. No sooner India was declared Independent as per the India Indepdence Act, 1947 on August 15, the FIRST Double Taxation Avoidance Agreement (DTAA) was born on December 10, 1947, with the new Dominon of Pakistan. That is another issue that this Tax Treaty is not in force but it does mark the beginning of the DTAA-journey for India. In the '50s India did very little on the DTAA front. Only towards the end of the decade India signed one Agreement with Sweden in 1959, followed by Japan and Germany in 1960. A couple of DTAAs were signed in the '60s but the real spurt was seen only in the late '70s, '80s and '90s. Even with the UK, India signed its first DTAA in 1981. The United States of America (USA) which has emerged as one of India's biggest trading partners, entered into an Agreement only in 1990 - barely days before India's then Prime Minister P V Narasimha Rao embarked on radical era of economic liberalisation in 1991. Since then the landscape of international taxation has only seen expansion and evolution in India.

Let's now move away from the turf of history and go straight to the Apex Court decision in the case of Azadi Bachao Andolan (2003-TII-02-SC-INTL). This case marks a turning point for the rapidly-evolving legal jurisprudence in the world of taxation of cross-border transactions. Although the country involved was Mauritius (culturally speaking, a look-alike for India) but it is common knowledge that Mauritius has been one of the hottest destinations for treaty-shoppers from the Developed World. Anyway, the allegations and the reality apart, our Apex Court laid down vital ratios for interpreting the deep-seated nuances of various phrases and expressions used in Articles of the DTAA with Mauritius. The law decided in this case became a universally accepted legal tool for other forums of the judiciary in India and elsewhere in the world to decide DTAA-related litigation.

After Azadi Bachao, one may come across a virtual flood of cases relating to DTAAs with the Netherlands, Singapore, the USA, the UK, France, Belgium and others. The decade of 2000 witnessed a sharp rise in the number of judicial decisions with respect to various Articles of largely similar DTAAs India had signed over the decade. Initially, most of the disputes used to partake the character of an Liaison Office and Permanent Establishment (Article 5); then came a phase of royalty and fees for technical services related disputes (largely Article 12); followed by a colourful basket of disputes relating to Articles 8, 10, 13, 14, 15, 17, 26 & 27. This virtual flood perhaps coaxed the authors of the First Edition of the Book - Mr Rajesh Kadakia and Nilesh Modi - in 2008 to design a handy and reliable tool for the legal practitioners of international taxation. A sustained and systemic effort led to the selection of as many as 450 Indian judicial decisions in the First Addition. And this number has now shot up to about 2300 in the second edition revised and updated in 2014 by Nilesh Modi. The second edition analyses nearly nearly 1,350 Indian decisions, 850 foreign judgments from 40 countries and 100 Australian revenue rulings, which are relevant for Indian treaties, making the book the MOST COMPREHENSIVE one of its kind. So has zoomed the number of pages from 895 to 1352.

A quick look at both the Editions reveals that what was commenced as an adventure in law has finally culminated into an intellectual venture with insightful commentaries and the elegance of user-friendly references on contentious issues. As the Maxim goes - the taste of the pudding lies in the eating, one needs to go inside this Edition to see how meticulously it has been arranged and the same can be measured from the fact that the author has devoted one chapter to each Article plus one for the introduction to tax treaties - thus, there are 31 Chapters in this treatise. Leaving no stone unturned the author has accommodated all possible contents available on the subject right from the CAG Report to CBDT Circulars and Instructions to global jurisprudence - a good amount of legal wisdom from the USA and Australia has been provided adequate space in this Edition. The author has painstakingly given pertinent references to both the tax conventions - the UN and the OECD Models.

As regards the growing involvement of India in shaping up the global taxation model through the UN and the OECD, the Author has taken pains to provide adequate coverage to its commentaries. Ever since the financial tsunami hit the global world and provided a new WINDOW to the G-7 Leadership to see the world of tax havens differently, the world of bilateral tax treaties started providing space to Tax Information Exchange Agreements (TIEAs). India has also signed a few. Then came the phase of amending DTAA through Protocols to accommodate the Article in relation to exchange of information. Picking up threads of new developments worldwide India also decided to frame General Anti-Avoidance Rules (GAAR). For effective sharing of banking information and also to collect vital intelligence, India decided to set up some Overseas Units where taxmen could be posted. All these recent developments have been accommodated in this Edition apart from lucid commentaries on divergent judicial viewpoints on vital issues.

There are certainly many more interesting features of this Edition but it would be wise on my part to leave them for the inquisitiveness of the readers to look for them and earn a 'Vasco da Gamian' sense of exploration and interpolation. In a nutshell, the Second Edition evidently reflects the sleepless nights of hardwork the author has put in to make it more meaningful and user-friendly. To conclude it, it is a must read treatise on Tax Treaties.


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