S. 9(1)(i) : Income deemed to accrue or arise in India – Permanent establishment – Interest will not be taxed at a higher rate- DTAA- India- Japan. [Art. 7, 11(2), 11(6), 14]
Where the assessee is a company incorporated in, and fiscally domiciled in, the Republic of Japan. The assessee, inter alia, earned income from interest on suppliers’ credit. It was held that mere existence of a permanent establishment of the assessee company in India does not attract higher rate of tax. The beneficial rate of tax as per Article 11(2) cannot be denied. (ITA No.: 10/Mum/2022 dated June 17, 2022) (Bench ‘I’ )(AY. 2016 -17).
DCIT v. Marubeni Corporation, Japan (Mum.)(Trib.) www.itatonline.org
[Coram: Hon’ble Shri Pramod Kumar (Vice President) and Hon’ble Shri Sandeep S. Karhail (Judicial Member)]