Court dismisses appeal on DTAA & Section 206AA for AY 2015-16, favoring assessee. DTAA prevails over domestic law.

The appeal challenging the order regarding Double Taxation Avoidance Agreement and Section 206AA applicability for the Assessment Year: 2015-16 was dismissed. The Court ruled in favor of the assessee, holding that DTAA provisions supersede domestic law even in the absence of a PAN card for the non-resident payee. The decision was based on a previous court ruling, emphasizing the importance of following established legal principles.

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Issues:
Challenging order dated 28.11.2019 in ITA No. 192/Bang/2018 for the Assessment Year: 2015-16 regarding Double Taxation Avoidance Agreement and Section 206AA applicability.

Analysis:

1. The appeal was filed by the Revenue challenging the order dated 28.11.2019 in ITA No. 192/Bang/2018 for the Assessment Year: 2015-16. The questions of law raised by the Revenue pertained to the applicability of the Double Taxation Avoidance Agreement (DTAA) over domestic law, specifically in relation to Section 206AA. The Tribunal was questioned for holding that DTAA provisions would supersede domestic law without considering the presence of Section 206AA, even when the non-resident payee does not possess a PAN card. Additionally, the Tribunal's decision was challenged concerning the invocation of Section 206AA in light of CBDT Circular No.5 of 2010 and Notification dated 24-6-2016.

2. The arguments were heard from Shri. M. Dilip, the learned standing counsel for the Revenue, and Shri. Ankur Pai Dhungat, the learned advocate for the respondent-assessee. The issues raised in this appeal were found to be covered by a previous decision of the Court in THE COMMISSIONER OF INCOME TAX AND ANOTHER Vs. M/S. WIPRO LTD. ITA No. 181/2019 & CONNECTED MATTERS - 29.11.2022. When the matter was brought to the attention of Shri. Dilip, he acknowledged the same without any dispute.

3. Considering the precedent set by the earlier decision of the Court, the appeal was dismissed. The Court ruled in favor of the assessee and against the Revenue, answering the questions of law in favor of the assessee. No costs were awarded in this matter. The judgment highlighted the importance of adhering to established legal principles and previous court decisions in resolving similar legal issues.

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