General Anti-Avoidance Rule limits impermissible tax avoidance and can override treaty benefits under the Income-tax framework.

General Anti-Avoidance Rule (GAAR) was introduced to combat impermissible tax avoidance and aggressive tax planning that erodes the tax base. The provisions were inserted into the Income-tax Act through Chapter X-A, later modified, and ultimately made applicable from assessment year 2018-19. Before that date, only Specified Anti-Avoidance Rules (SAARs) operated. The commentary also notes that GAAR applies notwithstanding section 90(2) and may override treaty benefits even where they are otherwise more favourable.

---

---

---