Dividend taxation under the treaty limits source-state withholding where the beneficial owner is resident, with PE connection exceptions. Under the DTAA, dividends paid by a company resident in one Contracting State to a resident of the other State may be taxed in the recipient's State, while the source State may also tax such dividends but with a statutory cap where the beneficial owner is resident in the other State; this does not affect taxation of the distributing company. 'Dividends' cover income from shares and similar profit-participating corporate rights. The reduced treatment is inapplicable where the beneficial owner's holding is effectively connected to a permanent establishment or fixed base in the source State, in which case rules on business profits or independent personal services apply.