CA Final · Direct Tax Laws & International Taxation · Double Taxation Relief
Meridian Holdings Ltd, a company incorporated in Country X, is a tax resident of Country X and has income from India covered by the India–X tax agreement. It wants to claim treaty relief for the relevant tax year. Under the Income-tax Act, 2025, which condition must it satisfy before the relief can be claimed?
The company must obtain a residence certificate from the Government of Country X and provide the other prescribed documents and information, which are in Form No. 41. Both conditions must be met before a non-resident can claim relief under a tax agreement.
- AIt must obtain a certificate of its residence from the Government of Country X and furnish the other prescribed documents and informationCorrect
- BIt must obtain a certificate of residence from the Assessing Officer in India in Form No. 43
- CIt must register with the Central Government as a specified association
- DIt must have a permanent establishment in India
Explanation
Section 159(8) says a non-resident assessee can claim agreement relief only when he has a certificate of residence from the Government of his country or specified territory and provides other prescribed documents and information. Form No. 43 is issued to Indian residents, so option B is the wrong direction. Neither specified-association status nor a PE is a condition.
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