Treaty between India and Singapore – Indian decision on limitation of benefit clause

The Income Tax Appellate Tribunal (ITAT) issued its decision on 31 May 2013 in the case of Abacus International (P) Ltd. v. DDIT (ITA 1045/Mum/2008) that, in absence of any evidence of remittance or receiving of interest income in Singapore, beneficial provisions of article 11(2) of the India - Singapore Income Tax Treaty (1994) (as amended through 2005)(the Treaty) will not apply (tax rate of 15%). Accordingly, interest income would be taxable at a tax rate of 20% as per the Income Tax Act 1961…