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CMA Final · Direct Tax Laws and International Taxation · Double Taxation Avoidance Agreements (DTAA)

Under the Income-tax Act, 2025, if a term used in a tax agreement is not defined in the agreement but is defined in the Act, which meaning applies?

The term takes the meaning assigned to it in the Income-tax Act, 2025, together with any explanation given by the Central Government. Other laws are resorted to only if the term is undefined in the agreement, the Act and the relevant notification.

  1. AThe meaning assigned in the Act and the explanation, if any, given by the Central GovernmentCorrect
  2. BThe meaning given in the law of the other contracting country
  3. CThe meaning in the Companies Act, 2013
  4. DNo meaning applies until a court decides

Explanation

Section 159(7)(a) states that where a term is not defined in the agreement but is defined in the Act, it has the meaning assigned in the Act and any explanation given by the Central Government. Meanings from other laws are used only where the term is undefined in the agreement, the Act and notifications.

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