Treaty relief under India-UK DTAA required verification of late-filed tax residency certificate before granting exemption.

Treaty relief under Article 16(1) of the India-UK Double Taxation Avoidance Agreement was linked to the assessee's UK service income and tax residency status during the relevant year. The Assessing Officer denied relief because the tax residency certificate was not furnished during assessment, but it was later produced before the appellate authority as additional evidence. As no remand report had been obtained, verification was required. The matter was therefore restored to the Assessing Officer for limited examination of the certificate and for granting relief if the claim was found correct.

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Issues: Whether the assessee was entitled to relief under Article 16(1) of the India-UK Double Taxation Avoidance Agreement and whether the matter required remand for verification of the tax residency certificate furnished for the first time before the appellate authority.

Analysis: The assessee was found to have rendered services in the United Kingdom and to be a tax resident there during the relevant year. The denial of treaty relief by the Assessing Officer rested on non-furnishing of the tax residency certificate during assessment proceedings. Since the certificate was produced before the appellate authority without a remand report from the Assessing Officer, the additional evidence required verification. In the interest of justice, the issue was restored to the Assessing Officer for the limited purpose of examining the tax residency certificate and granting relief if the claim was found to be correct.

Conclusion: The issue was remanded to the Assessing Officer for verification, and the revenue's appeal was treated as allowed for statistical purposes.

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