TaxTMI 
TaxTMI 
2024 (9) TMI 637
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....de addition of Rs. 211,61,53,235/- in the draft assessment order. The AO had denied assessee, being a tax resident of Singapore, to be eligible for the benefit as provided by the India-Singapore DTAA [Article 13(4)] and therefore, taxed the capital gain on sale of shares of an Indian company. Assessee had claimed that being a tax resident of Singapore, assessee is covered by the beneficial provisions of the India-Singapore DTAA (Article 11) and accordingly, interest income received from Compulsory Convertible Debentures (CCD) could not be taxed under the provisions of the Act. Further, AO had applied the tax as per rates of the Act as against the beneficial rate, claimed by the assessee, as per India-Singapore DTAA. 2.1 Against same the assessee approached DRP and filed objections. The plea of assessee before DRP was that the AO has erred in disregarding the Tax residency certificate (TRC) and other relevant documents furnished by the Company to support the fact that it is entitled to the beneficial provisions of the India- Singapore DTAA. Further that the AO has erred in not appreciating the facts as disclosed by the Company through a declaration duly signed by the director of ....
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....icle 24 of the India- Singapore DTAA are thoroughly met. * A copy of declaration as furnished by director of Company" Further, the assessee filed a single page purportedly from its financial statements pertaining to 2020 (and not the year under consideration) to support its claim of being engaged in real activities in Singapore. 4. During the proceedings, the assessee company was also asked to substantiate its claim of LTCG. In response, the assessee merely quoted the DTAA and stated that such LTCG was exempt as per the DTAA, in turn implying that the benefits provided some sort of blanket relief to taxpayers from providing any justification or documentation whatsoever of amounts claimed therein. This understanding of the provisions in the DTAA is grossly misplaced. In order to claim a benefit under Article 13, the onus is on the assessee to provide adequate documents in support of is claim" From the details above it is clear that assessee has not submitted the detail/documents required by the assessing officer. As such he has not discharged the onus cast upon him and is claiming the benefit just on the basis of the documents referred above. He h....
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.... reason that it would engender the unequal application of laws, and direct the tax authorities to adopt varied interpretations, to suit individual assesses, subjective to their convenience, a result at once debilitating and destructive of the rule of law. A previous Division Bench of this Court, in Rohitasava Chand v. Commissioner of had held that the rule of consistency cannot be of inflexible application." In view of the above discussion all the above grounds are dismissed." 3. The ld. AR has primarily relied on the submissions made before the DRP while the ld. DR has relied the orders of DRP. 4. After taking into consideration the material on record and the submissions, we are of the considered view that the Tax Residency Certificate, even if it is not a conclusive evidence of a tax residency of an entity, it certainly is a statutory evidence and the burden is on the Revenue to establish from the facts and circumstance that the entity has been formed and operated in a manner that the only intention was to take benefit of the tax treaty without there being actual intention of an economic activity. As for this proposition we rely a co-ordinate bench decision in case....
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....ty Global Shared Services India Private Limited ('TEGSSIPL') to a 3rd party on December 21, 2016. The said transfer of shares resulted in long term capital gains (held for more than 24 months) for the relevant AY. However, the Company was not liable to pay any tax on the capital gains as the same was tax exempted under Article 13(4) of India-Singapore DTAA ('DTAA'). 6.1 It was further pleaded that the Assessee's business is managed and controlled in Singapore. All the board meetings and shareholders meetings are held in Singapore and all the key decisions relating to business are taken in Singapore. 6.2 It was also pleaded that as per Article 24A ('Limitation of Benefit') of India-Singapore Tax Treaty, "A shell or conduit company is any legal entity falling within the definition of resident with negligible or nil business operations or with no real and continuous business activities carried out in that Contracting State." "A resident of a Contracting State is deemed to be a shell or conduit company if its annual expenditure on operations in that Contracting State is less than S$200,000 in Singapore or Indian Rs. 5,000,000 in India.". In this context assessee submitted that th....