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1A. Agreement for avoidance of
double taxation and prevention of fiscal evasion with Australia Whereas the
annexed Agreement between the Government of the Republic of India and the
Government of Australia for the avoidance of double taxation and the prevention
of fiscal evasion with respect to taxes on income has entered into force on the
30th day of December, 1991, on the exchange of notes notifying each other that
the last of such things has been done as is necessary to give the said
Agreement the force of law in India and in Australia, in accordance with
paragraph (1) of Article 28 of the said Agreement ; Now,
therefore, in exercise of the powers conferred by section 90 of the Income-tax
Act, 1961 (43 of 1961), and section 24A of the Companies (Profits) Surtax Act,
1964 (7 of 1964), the Central Government hereby directs that all the provisions
of the said Agreement shall be given effect to in the Union of Notification : No. GSR 60(E), dated 22-1-1992. annexure AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE
GOVERNMENT OF AUSTRALIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION
OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME The Government
of the ARTICLE I - Personal scope - This Agreement
shall apply to persons who are residents of one or both of the Contracting
States. ARTICLE II - Taxes covered 1. The existing
taxes to which this Agreement shall apply are : (a) in the income-tax, and the
resource rent tax in respect of offshore projects relating to exploration for
or exploitation of petroleum resources, imposed under the federal law of the
Commonwealth of Australia; (b) in (i) the income-tax including any surcharge
thereon; and (ii) the surtax imposed on chargeable profits of
companies. 2. This Agreement shall also apply to any
identical or substantially similar taxes which are imposed under the federal
law of the Commonwealth of Australia or the law of the ARTICLE III - General definitions - 1. For the
purposes of this Agreement, unless the context otherwise requires : (a) the
term (i) the (ii) the (iii) the (iv) the (v) the (vi) the and includes any area
adjacent to the temtorial limits of Australia [including the territories
specified in sub-paragraphs (i) to (vi) inclusive] in respect of
which there is for the time being in force, consistently with international
law, a law of Australia dealing with the exploitation of any of the natural
resources of the seabed and subsoil of the continental shelf; (b) the
term India means the territory of India and includes the territorial sea and the
air space above it, as well as any other maritime zone in which India has
sovereign rights, other rights and jurisdictions, according to the Indian law
and in accordance with international law; (c) the terms Contracting State, one of the Contracting States and
other Contracting State mean, as the context requires, Australia or India,
the Governments of which have concluded this Agreement; (d) the
term person includes an individual, a company, any other body of persons and
any other entity which is treated as a taxable unit for tax purposes; (e) the
term company means any body corporate or any entity which is treated as a
company or body corporate for tax purposes; (f) the
terms enterprise of one of the Contracting States and enterprise of the
other Contracting State mean an enterprise carried on by a resident of
Australia or an enterprise carried on by a resident of India, as the context
requires; (g) the
term tax means Australian tax or Indian tax, as the context requires ; (h) the term : (i) Australian tax means tax imposed by (ii) Indian tax means tax imposed by being tax to which this
Agreement applies by virtue of Article 2, but neither term includes any amount
which represents a penalty or fine or interest imposed under the law of either (i) the
term competent authority means, in the case of Australia, the Commissioner of
Taxation or an authorised representative of the Commissioner and, in the case
of India, the Central Government in the Ministry of Finance (Department of
Revenue) or their authorised representative; and (ii) the term year of income, in relation to
Indian tax, means previous year as defined in the Income-tax Act, 1961. 2. In the application of this Agreement by a
Contracting State, any term not defined in this Agreement shall, unless the
context otherwise requires, have the meaning which it has under the laws of
that State from time to time in force relating to the taxes to which this
Agreement applies. ARTICLE IV - Residence - 1. For the purposes of
this Agreement, a person is a resident of one of the Contracting States if the
person is a resident of that 2. Where, by reason of the provisions of
paragraph (1), an individual is a resident of both Contracting States, then the
status of that person shall be determined in accordance with the following
rules : (a) the
person shall be deemed to be a resident solely of the (b) if a
permanent home is available to the person in both Contracting States, or in
neither of them, the person shall be deemed to be a resident solely of the
Contracting State with which the persons personal and economic relations are
closer (centre of vital interests). For the
purposes of this paragraph, an individuals citizenship of a 3. Where, by reason of the provisions of
paragraph (1), a person other than an individual is a resident of both
Contracting States, then it shall be deemed to be a resident solely of the ARTICLE V - Permanent establishment - 1. For the
purposes of this Agreement, the term permanent establishment means a fixed
place of business through which the business of an enterprise is wholly or
partly carried on. 2. The term permanent establishment shall
include especially : (a) a place of management; (b) a branch; (c) an office; (d) a factory; (e) a workshop; (f) a mine,
an oil or gas well, a quarry or any other place of extraction of natural
resources; (g) a
warehouse in relation to a person providing storage facilities for others; (h) a farm,
plantation or other place where agricultural, pastoral, forestry or plantation
activities are carried on; (i) premises
used as a sales outlet or for receiving or soliciting orders; (j) an installation or structure, or plant or equipment, used for the
exploration for or exploitation of natural resources; (k) a
building site or construction, installation or assembly project, or supervisory
activities in connection with such a site or project, where that site or
project exists or those activities are carried on (whether separately or
together with other sites, projects or activities) for more than 6 months. 3. An enterprise shall be deemed to have a
permanent establishment in one of the Contracting States and to carry on
business through that permanent establishment if : (a) substantial
equipment is being used in that State by, for or under contract with the
enterprise; (b) it
carries on activities in that State in connection with the exploration for or
exploitation of natural resources in that State; or (c) it
furnishes services, including managerial services and those mentioned in
sub-paragraphs (3)(h) to (k) of Article 12 but not those services
in respect of which payments or credits that are royalties as defined in
Article 12 are made, within one of the Contracting States through employees or
other personnel, but only if those services are furnished within that State : (i) for a period or periods aggregating to more
than 90 days within any 12-month period; or (ii) for another
enterprise, if both enterprises are within either of the relationships
described in sub-paragraphs (1)(a) and (b) of Article 9. 4. An enterprise shall not be deemed to have a
permanent establishment merely by reason of : (a) the use
of facilities solely for the purpose of storage or display of goods or
merchandise belonging to the enterprise ; (b) the
maintenance of a stock of goods or merchandise belonging to the enterprise
solely for the purpose of storage or display ; (c) the
maintenance of a stock of goods or merchandise belonging to the enterprise
solely for the purpose of processing by another enterprise; (d) the
maintenance of a fixed place of business solely for the purpose of purchasing
goods or merchandise, or of collecting information, for the enterprise; or (e) the
maintenance of a fixed place of business solely for the purpose of advertising,
for the supply of information, for scientific research, or for similar
activities which have a preparatory or auxiliary character, for the enterprise. However, the
preceding provisions of this paragraph shall not apply where an enterprise of
one of the Contracting States maintains in the other 5. A person acting in one of the Contracting
States on behalf of an enterprise of the other (a) the
person has, and habitually exercises in that State, an authority to conclude
contracts on behalf of the enterprise, unless the persons activities are
limited to the purchase of goods or merchandise for the enterprise; (b) the
person has no such authority, but habitually maintains in that State a stock of
goods or merchandise from which the person regularly delivers goods or
merchandise on behalf of the enterprise; (c) the
person habitually secures orders in that State, wholly or principally for the
enterprise itself or for the enterprise and other enterprises controlling, or
controlled by or subject to the same common control as, that enterprise; or (d) in so acting, the person manufactures or processes in that State
for the enterprise goods or merchandise belonging to the enterprise. 6. An enterprise of one of the Contracting States
shall not be deemed to have a permanent establishment in the other Contracting
State merely because it carries on business in that other State through a
broker, a general commission agent or any other agent of an independent status,
where that person is acting in the ordinary course of the persons business as
such a broker or agent. However, when the activities of such a broker or agent
are carried on wholly or principally on behalf of that enterprise itself or on
behalf of that enterprise and other enterprises controlling, or controlled by
or subject to the same common control as, that enterprise, the person will not
be considered a broker or agent of an independent status within the meaning of
this paragraph. 7. The fact that a company which is a resident of
one of the Contracting States controls or is controlled by a company which is a
resident of the other Contracting State, or which carries on business in that
other State (whether through a permanent establishment or otherwise), shall not
of itself make either company a permanent establishment of the other. 8. The principles set forth in the preceding
paragraphs of this Article shall be applied in determining for the purposes of
paragraph (5) of Article 11 and paragraph (5) of Article 12 of this Agreement
whether there is a permanent establishment outside both Contracting States, and
whether an enterprise, not being an enterprise of one of the Contracting
States, has a permanent establishment in one of the Contracting States. ARTICLE VI - Income from real property (immovable
property) - 1. Income from real property may be taxed in the 2. For the purposes of this Article, the term
real property: (a) in the case of (i) a lease
of land and any other interest in or over land, whether improved or not; and (ii) a right
to receive variable or fixed payments either as consideration for the working
of or the right to work or explore for, or in respect of the exploitation of,
mineral or other deposits, oil or gas wells, quarries or other places of
extraction or exploitation of natural resources; and (b) in the
case of (i) property accessory to immovable property; (ii) rights to which the provisions of the general
law respecting landed property apply; and (iii) usufruct
of immovable property and rights to receive variable or fixed payments either
as consideration for the working of or the right to work or explore, for, or in
respect of exploitation of, mineral or other deposits, oil or gas wells,
quarries or other places of extraction or exploitation of natural resources. 3. A lease of land, any other interest in or
over land and any rights or property referred to in any of the sub-paragraphs
of paragraph (2) shall be regarded as situated where the land, mineral or other
deposits, oil or gas wells, quarries, natural resources or property, as the
case may be, are situated or where the exploration may take place. 4. The provisions of paragraph (1) shall apply
to income-derived from the direct use, letting or use in any other form of real
property. 5. The provisions of paragraphs (1), (3) and (4)
shall also apply to the income from real property of an enterprise and to
income from real property used for the performance of independent personal
services. ARTICLE VII - Business profits - 1. The profits of
an enterprise of one of the Contracting States shall be taxable only in that
State unless the enterprise carries on business in the other (a) that permanent establishment; or (b) sales within that other 2. Subject to the provisions of paragraph (3),
where an enterprise of one of the Contracting States carries on business in the
other Contracting State through a permanent establishment situated therein,
there shall in each Contracting State be attributed to that permanent
establishment the profits which it might be expected to make if it were
distinct and separate enterprise engaged in the same or similar activities
under the same or similar conditions and dealing wholly independently with the
enterprise of which it is a permanent establishment or with other enterprises
with which it deals. 3. In the determination of the profits of a
permanent establishment, there shall be allowed as deductions, in accordance
with and subject to the limitations of the law relating to tax in the
Contracting State in which the permanent establishment is situated, expenses of
the enterprise, being expenses which are incurred for the purposes of the
business of the permanent establishment (including executive and general
administrative expenses so incurred), whether incurred in the Contracting State
in which the permanent establishment is situated or elsewhere. 4. No profits shall be attributed to a permanent
establishment by reason of the mere purchase by that permanent establishment of
goods or merchandise for the enterprise. 5. Where the correct amount of profits
attributable to a permanent establishment is incapable of determination by the
taxation authority of one of the Contracting States or the ascertaining thereof
by that authority presents exceptional difficulties, nothing in this Article
shall affect the application of any law of that State relating to the
determination of the tax liability of a person, provided that the law shall be
applied, so far as the information available to that authority permits, in
accordance with the principles of this Article. 6. For the purposes of the preceding paragraphs
of this Article, the profits to be attributed to the permanent establishment
shall be determined by the same method year by year unless there is good and
sufficient reason to the contrary. 7. Where profits include items of income which
are dealt with separately in other Articles of this Agreement, then the
provisions of those Articles shall not be affected by the provisions of this
Article. 8. Nothing in this Article shall affect the
operation of any law of a Contracting State relating to tax imposed on profits
from insurance with non-residents provided that if the relevant law in force in
either Contracting State at the date of signature of this Agreement is varied
(otherwise than in minor respects so as not to affect its general character)
the Contracting States shall consult with each other with a view to agreeing to
any amendment of this paragraph that may be appropriate. 9. Where : (a) a
resident of one of the Contracting States is beneficially entitled, whether
directly or through one or more interposed trust estates, to a share of the
business profits of an enterprise carried on in the other Contracting State by
the trustee of a trust estate other than a trust estate which is treated in
that other State as a company for tax purposes; and (b) in
relation to that enterprise, that trustee would, in accordance with the
principles of Article 5, have a permanent establishment in that other the enterprise
carried on by the trustee shall be deemed to be a business carried on in that
other ARTICLE VIII - Ships and aircraft - 1. Profits from
the operation of ships or aircraft, including interest on funds connected with
that operation, derived by a resident of one of the Contracting States shall be
taxable only in that State. 2. Notwithstanding the provisions of paragraph (1),
such profits may be taxed in the other 3. The provisions of paragraphs (1) and (2) shall
apply in relation to the share of the profits from the operation of ships or
aircraft derived by a resident of one of the Contracting States through
participation in a pool service, in a joint transport operating organisation or
in an international operating agency. 4. For the purposes of this Article, profits
derived from the carriage by ships or aircraft of passengers, livestock, mail,
goods or merchandise shipped in a Contracting State for discharge at another
place in that State shall be treated as profits from operations of ships or
aircraft confined solely to places in that State. ARTICLE IX - Associated enterprises - 1. Where : (a) an
enterprise of one of the Contracting States participates directly or indirectly
in the management, control or capital of an enterprise of the other (b) the
same persons participate directly or indirectly in the management, control or
capital of an enterprise of one of the Contracting States and an enterprise of
the other and in either
case conditions operate between the two enterprises in their commercial or
financial relations which differ from those which might be expected to operate
between independent enterprises dealing wholly independently with one another,
then any profits which, but for those conditions, might have been expected to
accrue to one of the enterprises, but, by reason of those conditions, have not
so accrued, may be included in the profits of that enterprise and taxed
accordingly. 2. Nothing in this Article shall affect the
application of any law of a Contracting State relating to the determination of
the tax liability of a person, including determinations in cases where the
information available to the taxation authority of that State is inadequate to
determine the income to be attributed to an enterprise, provided that that law
shall be applied, so far as it is practicable to do so, consistently with the
principles of this Article. 3. Where profits on which an enterprise of one of
the Contracting States has been charged to tax in that State are also included,
by virtue of paragraph (1) or (2), in the profits of an enterprise of the other
Contracting State and charged to tax in that other State, and the profits so
included are profits which might have been expected to have accrued to that
enterprise of the other State if the conditions operative between the
enterprises had been those which might have been expected to have operated
between independent enterprises dealing wholly independently with one another,
then the first-mentioned State shall make an appropriate adjustment to the
amount of tax charged on those profits in the first-mentioned State. In
determining such an adjustment, due regard shall be had to the other provisions
of this Agreement and for this purpose the competent authorities of the
Contracting States shall, if necessary, consult each other. ARTICLE X - Dividends - 1. Dividends paid by a
company which is a resident of one of the Contracting States for the purposes
of its tax, being dividends to which a resident of the other Contracting State
is beneficially entitled, may be taxed in that other State. 2. Such dividends may also be taxed in the 3. The term dividends in this Article means
income from shares and other income which is subjected to the same taxation
treatment as income from shares by the laws of the 4. The provisions of paragraphs (1) and (2) shall
not apply if the person beneficially entitled to the dividends, being a
resident of one of the Contracting States, carries on business in the other Contracting
State of which the company paying the dividends is a resident, through a
permanent establishment situated therein, or performs in that other State
independent personal services from a fixed base situated therein, and the
holding in respect of which the dividends are paid is effectively connected
with such permanent establishment of fixed base. In any such case, the
provisions of Article 7 or Article 14, as the case may be, shall apply. 5. Dividends paid by a company which is a
resident of one of the Contracting States, being dividends to which a person
who is not a resident of the other Contracting State is beneficially entitled,
shall be exempt from tax in that other State except insofar as the holding in
respect of which the dividends are paid is effectively connected with a
permanent establishment or fixed base situated in that other State: Provided that
this paragraph shall not apply in relation to dividends paid by any company
which is a resident of Australia for the purposes of Australian tax and which
is also a resident of India for the purposes of Indian tax. ARTICLE XI - Interest - 1. Interest arising in
one of the Contracting States, being interest to which a resident of the other 2. Such interest may also be taxed in the 3. The term interest in this Article includes
interest from Government securities or from bonds or debentures, whether or not
secured by mortgage and whether or not carrying a right to participate in
profits, and interest from any other form of indebtedness as well as all other income
assimilated to income from money lent by the law, relating to tax, of the
Contracting State in which the income arises, but does not include interest
referred to in paragraph (1) of Article 8. 4. The provisions of paragraphs (1) and (2) shall
not apply if the person beneficiary entitled to the interest, being a resident
of one of the Contracting States, carries on business in the other Contracting
State, in which the interest arises, through a permanent establishment situated
therein, or performs in that other State independent personal services from a
fixed base situated therein, and the indebtedness in respect of which the
interest is paid is effectively connected with such permanent establishment or
fixed base. In such a case, the provisions of Article 7 or Article 14, as the
case may be, shall apply. 5. Interest shall be deemed to arise in a 6. Where, owing to a special relationship between
the payer and the person beneficially entitled to the interest, or between both
of them and some other person, the amount of the interest paid, having regard
to the indebtedness for which it is paid, exceeds the amount which might have
been expected to have been agreed upon by the payer and the person so entitled
in the absence of such relationship, the provisions of this Article shall apply
only to the last-mentioned amount. In that case, the excess part of the amount
of the interest paid shall remain taxable according to the law, relating to
tax, of each ARTICLE XII - Royalties - 1. Royalties arising in
one of the Contracting States, being royalties to which a resident of the other
2. Such royalties may also be taxed in the (a) in the case of : (i) royalties referred to in sub-paragraph (3)(b)
; (ii) payments or credits for services referred to
in sub-paragraph (3)(d), subject to sub-paragraphs (3)(h) to (l),
that are ancillary and subsidiary to the application or enjoyment of equipment
for which payments or credits are made under sub-paragraph (3)(b); or (iii) royalties referred to in sub-paragraph (3)(f)
that relate to equipment mentioned in sub-paragraph (3)(b) ; 10 per cent of the gross
amount of the royalties; and (b) in the case of
other royalties : (i) during the first 5 years of income for which
this Agreement has effect : (a) where the payer is the Government or a political sub-division of
that State or a public sector company: 15 per cent of the gross amount of the
royalties; and (b) in all other cases: 20 per cent of the gross amount of the
royalties; and (ii) during all subsequent years of income: 15 per
cent of the gross amount of the royalties. 3. The term royalties in this Article means
payments or credits, whether periodical or not, and however described or
computed, to the extent to which they are made as consideration for : (a) the use
of, or the right to use, any copyright, patent, design or model, plan, secret
formula or process, trade mark or other like property or right; (b) the use
of, or the right to use, any industrial, commercial or scientific equipment; (c) the
supply of scientific, technical, industrial or commercial knowledge or
information; (d) the
rendering of any technical or consultancy services (including those of
technical or other personnel) which are ancillary and subsidiary to the
application or enjoyment of any such property or right as is mentioned in
sub-paragraph (a), or any such equipment as is mentioned in
sub-paragraph (b) or any such knowledge or information as is mentioned
in sub-paragraph (c); (e) the use
of, or the right to use : (i) motion picture films; (ii) films or video
tapes for use in connection with television; or (iii) tapes for use in
connection with radio broadcasting; (f) total
or partial forbearance in respect of the use or supply of any property or right
referred to in sub-paragraphs (a) to (e); (g) the
rendering of any services (including those of technical or other personnel),
which make available technical knowledge, experience, skill, know-how or
processes or consist of the development and transfer of a technical plan or
design; but that term does not
include payments or credits relating to services mentioned in sub-paragraphs (d)
and (g) that are made; (h) for
services that are ancillary and subsidiary, and inextricably and essentially
linked, to a sale of property; (i) for
services that are ancillary and subsidiary to the rental of ships, aircraft,
containers or other equipment used in connection with the operation of ships or
aircraft in international traffic; (j) for teaching in or by an educational institution; (k) for services for the
personal use of the individual or individuals making the payments or credits;
or (l) to an employee of the person making the
payments or credits or to any individual or firm of individuals (other than a
company) for professional services as defined in Article 14. 4. The provisions of paragraphs (1) and (2) shall
not apply if the person beneficially entitled to the royalties, being a
resident of one of the Contracting States, carries on business in the other
Contracting State, in which the royalties arise, through a permanent
establishment situated therein, or performs in that other State independent
personal services from a fixed base situated therein, and the property, right
or services in respect of which the royalties are paid or credited are
effectively connected with such permanent establishment or fixed base. In such
a case, the provisions of Article 7 or Article 14, as the case may be, shall
apply. 5. Royalties shall be deemed to arise in a 6. Where, owing to a special relationship between
the payer and the person beneficially entitled to the royalties, or between
both of them, and some other person, the amount of the royalties paid or
credited, having regard to what they are paid or credited for, exceeds the
amount which might have been expected to have been agreed upon by the payer and
the person so entitled in the absence of such relationship, the provisions of
this Article shall apply only to the last-mentioned amount. In that case, the
excess part of the amount of the royalties paid or credited shall remain
taxable according to the law, relating to tax, of each ARTICLE XIII - Alienation of property 1. Income or
gains derived by a resident of one of the Contracting States from the
alienation of real property referred to in Article 6 and, as provided in that
Article, situated in the other Contracting State may be taxed in that other
State. 2. Income or gains derived from the alienation of
property, other than real property referred to in Article 6, that forms part of
the business property of a permanent establishment which an enterprise of one
of the Contracting States has in the other Contracting State or pertains to a
fixed base available to a resident of the first-mentioned State in that other
State for the purpose of performing independent personal services, including
income or gains from the alienation of such a permanent establishment (alone or
with the whole enterprise) or of such a fixed base, may be taxed in that other
State. 3. Income or gains derived from the alienation of
ships or aircraft operated in international traffic, or of property other than
real property referred to in Article 6 pertaining to the operation of those
ships or aircraft, shall be taxable only in the 4. Income or gains derived from the alienation of
shares or comparable interests in a company, the assets of which consist wholly
or principally of real property referred to in Article 6 and, as provided in
that Article, situated in one of the Contracting States, may be taxed in that
State. 5. Income or gains derived from the alienation
of shares or comparable interests in a company, other than those referred to in
paragraph (4), may be taxed in the 6. Nothing in this Agreement affects the
application of a law of a ARTICLE XIV - Independent personal services - 1.
Income derived by an individual or a firm of individuals (other than a company)
who is a resident of one of the Contracting States in respect of professional services
or other independent activities of a similar character shall be taxable only in
that State unless : (a) the
individual or firm has a fixed base regularly available to the individual or
firm in the other Contracting State for the purpose of performing the
individuals or the firms activities, in which case the income may be taxed in
that other State but only so much of it as is attributable to activities
exercised from that fixed base; or (b) the
stay by the individual or, in the case of a firm, by one or more members of the
firm (alone or together) in the other Contracting State is for a period or
periods amounting to or exceeding 183 days in a year of income, in which case
only so much of the income as is derived from the activities of the individual,
that member or those members, as the case may be, in that other State may be
taxed in that other State. 2. The term professional services includes
services performed in the exercise of independent scientific, literary,
artistic, educational or teaching activities as well as in the exercise of the
independent activities of physicians, surgeons, lawyers, engineers, architects,
dentists and accountants. ARTICLE XV - Dependent personal services - 1. Subject
to the provisions of Articles 16, 17, 18, 19 and 20, salaries, wages and other
similar remuneration derived by an individual who is a resident of one of the
Contracting States in respect of an employment shall be taxable only in that
State unless the employment is exercised in the other 2. Notwithstanding the provisions of paragraph
(1), remuneration derived by an individual who is a resident of one of the
Contracting States in respect of an employment exercised in the other (a) the
recipient is present in that other State for a period or periods not exceeding
in the aggregate 183 days in a year of income of that other State; (b) the
remuneration is paid by, or on behalf of, an employer who is not a resident of
that other State; and (c) the
remuneration is not deductible in determining taxable profits of a permanent establishment or a fixed base
which the employer has in that other State. 3. Notwithstanding, the preceding provisions of
this Article, remuneration in respect of an employment exercised aboard a ship
or aircraft operated in international traffic by a resident of one of the
Contracting States may be taxed in that State. ARTICLE XVI - Directors fees - Directors fees
and similar payments derived by a resident of one of the Contracting States as
a member of the Board of Directors of a company which is a resident of the
other ARTICLE XVII - Entertainers - 1. Notwithstanding
the provisions of Articles 14 and 15, income derived by residents of one of the
Contracting States as entertainers, such as theatre, motion picture, radio or
television artists, musicians and athletes, from their personal activities as
such exercised in the other Contracting State, may be taxed in that other
State. 2. Where income in respect of the personal
activities of an entertainer as such accrues not to that entertainer but to
another person, that income may, notwithstanding the provisions of Articles 7,
14 and 15, be taxed in the 3. Notwithstanding the provisions of paragraph
(1), income derived by an entertainer who is a resident of one of the
Contracting States, from the entertainers personal activities as such
exercised in the other Contracting State, shall be taxable only in the
first-mentioned Contracting State if the activities in the other Contracting
State are supported wholly or substantially from the public funds of the
first-mentioned Contracting State, including any of its political sub-divisions
or local authorities. 4. Notwithstanding the provisions of paragraph
(2) and Articles 7, 14 and 15, where income in respect of personal activities
exercised by an entertainer in the entertainers capacity as such in one of the
Contracting States accrues not to the entertainer but to another person, that
income shall be taxable only in the other Contracting State if that other
person is supported wholly or substantially from the public funds of that other
State, including any of its political sub-divisions or local authorities. ARTICLE XVIII - Pensions and annuities - 1. Pensions
(not including pensions referred to in Article 19) and annuities paid to a
resident of one of the Contracting States shall be taxable only in that State. 2. The term annuity means a stated sum payable
periodically at stated times during life or during a specified or ascertainable
period of time under an obligation to make the payments in return for adequate
and full consideration in money or moneys worth. ARTICLE XIX - Government service - 1. Remuneration,
other than a pension or annuity, paid by one of the Contracting States or
political sub-division or local authority of that State to any individual in
respect of services rendered in the discharge of governmental functions shall
be taxable only in that State. However, such remuneration shall be taxable only
in the other Contracting State if the services are rendered in that other State
and the recipient is a resident of that other State who : (a) is a citizen of that State; or (b) did not become a resident of that State solely for the purpose of
performing the services. 2. Any pension paid by, or out of funds created
by, one of the Contracting States or a political sub-division or a local
authority thereof to an individual in respect of services rendered to that
State or sub-division or authority shall be taxable only in that State.
However, such pension shall be taxable only in other 3. The provisions of Articles 15, 16 and 18
shall apply, as appropriate in the circumstances, to remuneration and pensions
in respect of services rendered in connection with a business carried on by one
of the ARTICLE XX - Professors and teachers - 1. Where
a professor or teacher who is a resident of one of the Contracting States
visits the other Contracting State for a period not exceeding two years for the
purpose of teaching or carrying out advanced study or research at a University,
college, school or other educational institution, any remuneration that person
receives for such teaching, advanced study or research shall be exempt from tax
in that other State to the extent to which such remuneration is, or upon the
application of this Article will be, subject to tax in the first-mentioned
State. 2. This Article shall not apply to remuneration
which a professor or teacher receives for conducting research if the research
is undertaken primarily for the private benefit of a specific person or
persons. ARTICLE XXI - Students and trainees - Where a
student or trainee, who is a resident of one of the Contracting States or who
was a resident of that State immediately before visiting the other Contracting
State and who is temporarily present in that other State solely for the purpose
of the students or trainees education or training, receives payments from
sources outside that other State for the purpose of the students or trainees
maintenance, education or training, those payments shall be exempt from tax in
that other State. ARTICLE XXII - Income not expressly mentioned - 1. Items
of income of a resident of one of the Contracting States which are not
expressly mentioned in the foregoing Articles of this Agreement shall be
taxable only in that State. 2. However, any such income derived by a resident
of one of the Contracting States from sources in the other 3. The provisions of paragraph (1) shall not
apply to income derived by a resident of one of the Contracting States where
that income is effectively connected with a permanent establishment or fixed
base situated in the other ARTICLE XXIII - Source of income - 1. Income,
profits or gains derived by a resident of one of the Contracting States which,
under any one or more of Articles 6 to 8, Articles 10 to 20 and Article 22 may
be taxed in the other Contracting State, shall for the purpose of the law of that
other State relating to its tax, be deemed to be income from sources in that
other State. 2. Income, profits or gains derived by a resident
of one of the Contracting States which, under any one or more of Articles 6 to
8, Articles 10 to 20 and Article 22 may be taxed in the other Contracting
State, shall for the purposes of Article 24 and of the law of the
first-mentioned State relating to its tax, be deemed to be income from sources
in that other State. ARTICLE XXIV - Methods of elimination of double taxation
- 1. (a) Subject to the provisions of the law of Australia from time
to time in force which relate to the allowance of a credit against Australian
tax or tax paid in a country outside Australia (which shall not affect the
general principle hereof), Indian tax paid under the law of India and in
accordance with this Agreement, whether directly or by deduction, in respect of
income derived by a person who is a resident of Australia from sources in India
shall be allowed as a credit against Australian tax payable in respect of that
income. (b)
Where a company which is a resident of India and is not a resident of Australia
for the purposes of Australian tax pays a dividend to a company which is a
resident of Australia and which controls directly or indirectly not less than
10 per cent of the voting power of the first-mentioned company, the credit
referred to in sub-paragraph (a) shall include the Indian tax paid by
that first-mentioned company in respect of that portion of its profits out of
which the dividend is paid. 2. In paragraph (1), Indian tax paid shall
include : (a) subject to sub-paragraph (b) an amount equivalent to the
amount of any Indian tax foregone which, under the law of India relating to
Indian tax and in accordance with this Agreement, would have been payable as
Indian tax on income but for an exemption from, or reduction of, Indian tax on
that income in accordance with : (i) section
10(4), 10(15)(iv), 10A, 10B, 80HHC, 80HHD or 80-I of the
Income-tax Act, 1961, insofar as those provisions were in force on, and have
not been modified since, the date of signature of this Agreement, or have been
modified only in minor respects so as not to affect their general character; or (ii) any
other provision which may subsequently be made granting an exemption from or
reduction of Indian tax which the Treasurer of Australia and the Ministry of
Finance of India agree from time to time in letters exchanged for this purpose
to be of a substantially similar character, if that provision has not been
modified thereafter or has been modified only in minor respects so as not to
affect its general character; and (b) in the case of
interest derived by a resident of Australia which is exempted from Indian tax
under the provisions referred to in sub-paragraph (a), the amount which
would have been payable as Indian tax if the interest had not been so exempt
and if the tax referred to in paragraph (2) of Article 11 did not exceed 10 per
cent of the gross amount of the interest. 3. Paragraph (2) shall apply only in
relation to income derived in any of the first 10 years of income in relation
to which this Agreement has effect under sub-paragraph (1)(a)(ii) of Article 28 or in any later year of
income that may be agreed by the Contracting States in letters exchanged for
this purpose. 4. In the case of (a) the
amount of Australian tax paid under the laws of Australia and in accordance
with the provisions of this Agreement, whether directly or by deduction, by a
resident of India in respect of income from sources within Australia which has
been subjected to tax both in India and Australia shall be allowed as a credit
against the Indian tax payable in respect of such income but in an amount not
exceeding that proportion of Indian tax which such income bears to the entire
income chargeable to Indian tax; and (b) for the
purposes of the credit referred to in sub-paragraph (a) above, where the
resident of India is a company by which surtax is payable, the credit to be
allowed against Indian tax shall be allowed in the first instance against the
income-tax payable by the company in India and, as to the balance, if any,
against the surtax payable by it in India. 5. Where a resident of one of the Contracting
States derives income which, in accordance with the provisions of this
Agreement shall be taxable only in the other Contracting States, the
first-mentioned State may take that income into account in calculating the
amount of its tax payable on the remaining income of that resident. ARTICLE XXV - Mutual agreement procedure - 1.
Where a person who is a resident of one of the Contracting States considers
that the actions of the taxation authority of one or both of the Contracting
States result or will result for the person in taxation not in accordance with
this Agreement, the person may, notwithstanding the remedies provided by the
national laws of those States, present a case to the competent authority of the
Contracting State of which the person is a resident. The case must be presented
within three years from the first notification of the action giving rise to
taxation not in accordance with this Agreement. 2. The competent authority shall endeavour, if
the claim appears to it to be justified and if it is not itself able to arrive
at an appropriate solution, to resolve the case with the competent authority of
the other 3. The competent authorities of the Contracting
States shall jointly endeavour to resolve any difficulties or doubts arising as
to the application of this Agreement. 4. The competent authorities of the Contracting
States may communicate with each other directly for the purpose of giving
effect to the provisions of this Agreement. ARTICLE XXVI - Exchange of information - 1. The competent
authorities of the Contracting States shall exchange such information as is
necessary for the carrying out of this Agreement or of the domestic laws of the
Contracting States concerning the taxes to which this Agreement applies insofar
as the taxation thereunder is not contrary to this Agreement, or for the
prevention of evasion or avoidance of, or fraud in relation to, such taxes. The
exchange of information is not restricted by Article 1. Any information
received by the competent authority of a Contracting State shall be treated as
secret in the same manner as information obtained under the domestic laws of
that State and shall be disclosed only to persons or authorities (including
Courts and administrative bodies) concerned with the assessment or collection
of, enforcement or prosecution in respect of, or the determination of appeals
in relation to, the taxes to which this Agreement applies and shall be used
only for such purposes. They may disclose the information in public court
proceedings or in judicial decisions. 2. The competent authorities may, through
consultation, develop appropriate conditions, methods and techniques concerning
the matters in respect of which such exchange of information shall be made. The
exchange of information shall be either on a routine basis or on request with
reference to particular cases, or both. The competent authorities of the
Contracting States may agree from time to time in the list of the information
which shall be furnished on a routine basis. 3. In no case shall the provisions of paragraph
(1) be construed so as to impose on the competent authority of a (a) to
carry out administrative measures at variance with the laws or the
administrative practice of that or of the other (b) to
supply information which is not obtainable under the laws or in the normal
course of the administration of that or of the other (c) to
supply information which would disclose any trade, business, industrial,
commercial or professional secret or trade process, or to supply information
the disclosure of which would be contrary to public policy. ARTICLE XXVII - Diplomatic and consular officials - Nothing
in this Agreement shall affect the fiscal privileges of diplomatic or consular
officials under the general rules of international law or under the provisions
of special international agreements. ARTICLE XXVIII - Entry into force - 1. This Agreement
shall enter into force on the date on which the Contracting States exchange
notes through the diplomatic channel notifying each other that the last of such
things has been done as is necessary to give this Agreement the force of law in
Australia and in India, as the case may be, and thereupon this Agreement shall
have effect : (a) in (i) in
respect of withholding tax on income that is derived by a non-resident, in
relation to income derived on or after 1 July in the calendar year next
following that in which the Agreement enters into force; and (ii) in respect
of other Australian tax, in relation to income, profits or gains of any year of
income beginning on or after 1 July in the calendar year next following that in
which the Agreement enters into force; (b) in 2. The Agreement made between the Government of
Australia and the Government of the Republic of India for the Avoidance of
Double Taxation of Income derived from International Air Transport signed at
Canberra on 31 May, 1983 (in this Article called the 1983 Agreement) shall
cease to have effect with respect to taxes to which this Agreement applies when
the provisions of this Agreement become effective in accordance with paragraph
(1). 3. The 1983 Agreement shall terminate on the
expiration of the last date on which it has effect in accordance with the
foregoing provisions of this Article. ARTICLE XXIX - Termination - This Agreement shall
continue in effect indefinitely, but either of the Contracting States may, on
or before 30 June in any calendar year beginning after the expiration of 5
years from the date of its entry into force, give to the other Contracting State
through the diplomatic channel written notice of termination and, in that
event, this Agreement shall cease to be effective : (a) in (i) in
respect of withholding tax on income, that is, derived by a non-resident, in
relation to income derived on or after 1 July in the calendar year next
following that in which the notice of termination is given; and (ii) in
respect of other Australian tax, in relation to income, profits or gains of any
year of income beginning on or after 1 July in the calendar year next following
that in which the notice of termination is given; (b) in In witness whereof the
undersigned, duly authorised thereto, have signed this Agreement. Done in duplicate at Canberra this twenty-fifth day of July, one thousand nine hundred and ninety-one in the Hindi and English languages, both texts being equally authentic, the English text to be the operative one in any case of doubt.
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