Dividend Distribution Tax refund claim fails where the levy is on distributed profits and no return is filed for statutory refund procedure.

Dividend Distribution Tax under section 115-O is treated as a levy on the domestic company's distributed profits, not as tax in the hands of the shareholder, so the India-Netherlands DTAA was not triggered on the facts stated. A refund claim for excess DDT was also found not maintainable because section 239(1) requires a refund application to be made by furnishing a return in accordance with section 139, and no return had been filed. The related claim for interest under section 244A therefore also failed, and the refund request was rejected.

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Issues: Whether the assessee was entitled to refund of excess Dividend Distribution Tax paid on dividend remitted to a non-resident shareholder under the India-Netherlands Double Taxation Avoidance Agreement, and whether such refund claim was maintainable without filing a return in accordance with section 139.

Analysis: Dividend Distribution Tax under section 115-O of the Income-tax Act, 1961 is a charge on the profits distributed by the domestic company and not a tax in the hands of the shareholder. On that basis, the Double Taxation Avoidance Agreement was held not to be triggered in the present situation. Independently, section 239(1) requires a refund claim under Chapter XIX to be made by furnishing a return in accordance with section 139. Since no return of income had been filed for claiming the refund, the claim was held to be not maintainable. The claim for interest under section 244A also could not survive once the refund claim failed.

Conclusion: The refund claim was rejected and the assessee was denied relief.

Final Conclusion: The appeals failed in entirety and the orders of the lower authority were sustained for all assessment years.

Ratio Decidendi: A refund claim for excess Dividend Distribution Tax is not maintainable where the tax is a levy on distributed profits and not on the shareholder, and no return is filed in the manner required for a statutory refund claim under section 239(1) read with section 139 of the Income-tax Act, 1961.

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