#double taxation avoidance

ITAT Mumbai rules that interest earned by Indian branches of foreign banks from their head office or overseas branches is not taxable under Section 9(1)(v)(c) of the Income Tax Act, as it constitutes payment to self rather than income. The decision reinforces the mutuality principle, shielding such transactions from domestic tax liability for foreign banks operating in India.

ITAT Delhi clarifies that only unique solar days of employee presence in India count toward the 90-day threshold for Service Permanent Establishment under Article 5(2)(l) of the India-US DTAA, rejecting the Revenue’s cumulative man-day approach. This ruling impacts foreign companies providing services in India, ensuring tax liability is determined by actual presence rather than aggregated workdays.

ITAT Delhi rules that under the India-UAE DTAA, capital gains from debt mutual funds are exempt in India if the assessee is a UAE tax resident, even if UAE does not levy personal income tax. The ruling clarifies that 'liable to tax' under the treaty refers to residence-based jurisdiction, not actual tax payment, impacting cross-border investors and tax planners.

ITAT Delhi rules that delivery order charges received by Turkish Airlines are integral to international air transport profits under Article 8 of the India-Turkey DTAA, making them taxable only in Turkey. The decision clarifies that ancillary charges directly connected to air cargo operations fall within the scope of 'international traffic' and are exempt from Indian taxation.