Petition for seeking Decree of Divorce by Mutual Consent    In the Court of Ms..................................,Family Courts, District..................., New Delhi  Ms. ..................... Petitioner versus Mr. ..................... Respondent Petition for a decree for dissolving marriage by mutual consent under section 13-B of the Hindu Marriage Act, 1955. The humble petition of the said ........... RESPECTFULLY SHWETH: 1. That the parties to this present petition are both by religion and faith Hindus and they were married per Hindu rites/customs at........... on ............... and the said marriage is still existing. They are of age above 21 years. 2. The parties ever since the marriage did not pull on together being of different tastes habits,, ideas, and bearing and so being completely different nature and temperament and could never adjust themselves even for some days and so had no love nor heart for each other and there are not going to reconcile between them in future. 3. That the parties last lived/cohabited at ................ within the jurisdiction of this court when petitioner ............ of own and out of free will/accord broke the matrimonial home and withdrew herself from the company of said ............ with all her personal belongings and since then she has been residing and living at her father's house and is undesired any with any wish for uniting with her husband. 4. That except as hereunder stated there were no other proceedings between parties. 5. That the above petition is bona fide and not presented in collusion between the parties. 6. That there is every legal grounds in granting the relief. Your petitioners hence pray for a Decree of dissolution of marriage by mutual consent under section 13B of the Hindu Marriage Act 1955 and also and other Orders be made as to this Learned Court may deem proper and fit. And your petitioners as in duty bound shall ever pray,  Verification I, Mr............. son of............... aged about............ years residing at......... do hereby solemnly affirm and say as follows: I am the petitioner No. 1 above-named and I know and I have made myself acquainted with the facts and circumstances of this case. The statements in paragraphs 1 to 6 are true to my knowledge and belief. I sign this verification on this ............ day of............... at the Court House at ........................ Signature of Mr................ Verification I, Ms............. wife of Mr.............. daughter of ……, aged about............ years by occupation service residing at......... do hereby solemnly affirm and say as follows: I am the petitioner No. 2 above-named. I know and I have made myself acquainted with the facts and circumstances of this case. The statements in paragraphs 1 to 6 of the petition hereinabove are true to my knowledge and belief. I sign this verification on this ............ day of............... at the Court House at................ Signature of Ms.............. Download Word Document In English. (Rs.20/-) Download PDF Document In Marathi. (Rs.20/-)

ADOPTION BY A HINDU WIDOW  THIS DEED of adoption made on this________    day of ___________________ by ______________,  widow of Late Sh.______________  r/o______________. WHEREAS  1. My husband died on ___________ and we had no son, son’s son or son’s son’s son. 2. I have this day adopted _____________________ (name of the child),  son of Sh .___________________  r/o ___________________________________________________,  aged________  as my son and the said child having been given to me in adoption by his father with the consent of the child’s mother.  3. The ceremony of giving and taking in adoption has been duly performed on _____________  along with other religious ceremonies.  NOW  I, ___________________, hereby declare that I have adopted the said child as my son and the said child has been transferred to the family of my husband and shall have, from the date of adoption, all the legal rights and liabilities of an adopted son. I further confirm that I have executed this deed out of my free will without any compulsion from any person.  IN WITNESS WHERE OF, I am signing this deed this ____________day of __________. Witness: 1. __________________  Smt.______________  2.  Download Word Document In English. (Rs.20/-) Download PDF Document In Marathi. (Rs.20/-)

Adoption by a Hindu Widow    THIS DEED of adoption made on this________ day of __________by ______________, widow of Late Sh.______________ r/o______________. WHEREAS1. My husband died on ___________ and we had no son, son’s son or son’s son’s son.2. I have this day adopted __________ (name of the child), son of Sh ._____________r/o __________________, aged ___ as my son and the said child having been given to me in adoption by his father with the consent of the child’s mother.3. The ceremony of giving and taking in adoption has been duly performed on ________ along with other religious ceremonies. NOW I, ____________, hereby declare that I have adopted the said child as my son and the said child has been transferred to the family of my husband and shall have, from the date of adoption, all the legal rights and liabilities of an adopted son. I further confirm that I have executed this deed out of my free will without any compulsion from any person. IN WITNESS WHERE OF, I am signing this deed this ____________day of __________. Witness: 1.Mr . __________________ Witness  2. Smt.______________   Download Word Document In English. (Rs.15/-) Download PDF Document In Marathi. (Rs.15/-)

Download Word Document In English. (Rs.40/-) Download PDF Document In Marathi. (Rs.35/-) Surrogate Parenting Agreement This Agreement is made on ________________  (Date), by and between ____________________________________,  a married woman (Referred toas Surrogate),  ________________________________,  her husband (Referred to as Surrogate's Husband),  who both reside at___________________________________________  (Address) and ________________________________,  (Referred to as Natural Father), who residesat ____________________________________________________ (Address).  RECITALS This Agreement is made with reference to the following facts: A. Natural Father is a married man over the age of __________ (______) (Eighteen (18) or Applicable Age Required by Statute) yearswho desires to enter into this Agreement, the sole purpose of which is to enable the Natural Father and his wife, who cannotconceive, to have a child who is biologically related to the Natural Father. B. Surrogate and Surrogate?s Husband are over the age of _________ (______) (eighteen (18)) years and both desire and are willingto enter into this Agreement subject to the terms and conditions contained in this Agreement.NOW THEREFORE, in consideration of themutual promises, representations, terms and conditions contained in this Agreement, the parties agree as follows:  CLAUSE ONE Surrogate represents that she is capable of conceiving children. Surrogate understands and agrees that in the best interests of thechild she will not form or attempt to form a parent-child relationship with any child or children she may conceive, carry to term, andgive birth to, pursuant to this Agreement.  CLAUSE TWO Surrogate and Surrogate's Husband have been married since _____________ (Date). Surrogate's Husband agrees with the purposes andprovisions of this Agreement and acknowledges that his wife, Surrogate, shall be artificially inseminated pursuant to the provisions ofthis Agreement. Surrogate's Husband agrees that in the best interests of the child he will not form or attempt to form a parent-childrelationship with any child or children Surrogate may conceive by artificial insemination, as described in this agreement, and agreesto freely and readily surrender immediate custody of the child to Natural Father.Surrogate's Husband further agrees to terminate his parental rights to such child. Surrogate's Husband acknowledges he will do allacts necessary to rebut the presumption of paternity of any offspring conceived and born pursuant to this Agreement as provided by law,including blood testing and/or HLA testing.  CLAUSE THREE Surrogate shall be artificially inseminated with the semen of Natural Father by a physician. Surrogate, upon becoming pregnant, agreesshe will carry the embryo (or fetus) until delivery. Surrogate and Surrogate's Husband, agree that they will cooperate with anybackground investigation into Surrogate's medical, family, and personal history and warrants the information to be accurate to the best oftheir knowledge and belief. Surrogate and Surrogate's Husband agree to surrender custody of the child to Natural Father, toinstitute, and cooperate, in proceedings to terminate their respective parental rights to such child, and to sign any and all necessaryaffidavits, documents, and papers in order to further the intent and purposes of this Agreement. Surrogate and Surrogate's Husbandunderstand that the child is being conceived for the sole purpose of giving such child to Natural Father, its natural and biologicalfather. Surrogate and Surrogate's Husband agree to sign all necessary affidavits and other documents, prior to and subsequent to the birthof the child, and to voluntarily participate in any paternity proceedings necessary for the Natural Father's name to be entered onthe child's birth certificate as the natural or biological father.  CLAUSE FOUR The consideration for this Agreement which is compensation for services and expenses, and should in no way be construed as a fee forthe termination of parental rights or as payment in exchange for a consent to surrender the child for adoption, in addition to otherprovisions contained in this Agreement, shall be as follows: 1. ____________ (Rs.________) Rupees shall be paid to Surrogate, for services and expenses in carrying out Surrogate's obligations under this Agreement, immediately upon surrender to Natural Father custody of the child born pursuant to the provisions of this Agreement. 2. The consideration to be paid to Surrogate shall be deposited with _____________ (Referred to as Custodian), the representative of Natural Father, at the time of the signing of this Agreement and shall be held in escrow until completion of the duties and obligations of Surrogate as provided for in this Agreement. 3. Natural Father shall pay the expenses incurred by Surrogate, pursuant to her pregnancy, which are specifically defined as follows:(a) All medical, hospitalization, pharmaceutical, laboratory, and therapy expenses, incurred as a result of Surrogate's pregnancy, not covered or allowed by her present health and major medical insurance, including all extraordinary medical expenses and all reasonable expenses for treatment of any emotional, mental, or other problems related to such pregnancy. In no event, however, shall any such expenses be paid or reimbursed after a period of __________ (___) months has elapsed since the date of the termination of the pregnancy. This agreement specifically excludes expenses for lost wages or other non-itemized incidentals related to such pregnancy.(b) Natural Father shall not be responsible for any medical, hospitalization, pharmaceutical, laboratory, or therapy expenses occurring __________ (_____) months after the birth of the child, unless the medical problem incident to such expenses was known and treated by a physician prior to the expiration of the __________ (_____) month period and written notice advising of this treatment is given to Custodian, as representative of Natural Father, by certified mail, return receipt requested.(c) Natural Father shall be responsible for the total cost of all paternity testing. Such paternity testing may, at the option of Natural Father, be required prior to release of the Surrogate fee from escrow. If Natural Father is conclusively determined not to be the biological father of the child as a result of an HLA test, this Agreement will be deemed breached and Surrogate shall not be entitled to any fee, and Natural Father shall be entitled to reimbursement of all medical and related expenses from Surrogate and Surrogate's Husband.(d) Natural Father shall be responsible for Surrogate's reasonable travel expenses incurred at the request of Natural Father pursuant to this Agreement.  CLAUSE FIVE Surrogate and Surrogate's Husband are aware, understand, and agree to assume all risks, including the risk of death, which areincidental to conception, pregnancy, childbirth, and includes, but is not limited to, complications subsequent to such childbirth.  CLAUSE SIX Surrogate and Surrogate's Husband, hereby agree to undergo psychiatric evaluation by _____________________________________, apsychiatrist, as designated by Natural Father. Natural Father shall pay for the cost of such psychiatric evaluation. Prior to theirevaluations, Surrogate and Surrogate's Husband shall sign a medical release permitting dissemination to Custodian or Natural Father andhis wife copies of the report prepared as a result of such psychiatric evaluations.  CLAUSE SEVEN Surrogate and Surrogate's Husband hereby agree it is the exclusive and sole right of Natural Father to name such child born pursuantto this agreement.  CLAUSEEIGHT Child, as referred to in this agreement, shall include all children born simultaneously pursuant to the inseminations contemplated inthis Agreement.  CLAUSE NINE In the event of the death of Natural Father prior or subsequent to the birth of such child, it is understood and agreed by Surrogateand Surrogate's Husband, the child will be placed in the custody of Natural Father's wife.  CLAUSE TEN In the event the child is miscarried prior to the ______ (____) (Fifth or as the Case May Be) month of pregnancy, no compensation, asenumerated in Section Four, Paragraph 1, shall be paid to Surrogate. However, the expenses enumerated in Section Four, Paragraph 3shall be paid or reimbursed to Surrogate. In the event the child is miscarried, dies, or is stillborn subsequent to the _______ (_____)(Fourth or as the Case May Be) month of pregnancy the Surrogate shall receive _____________ ($______) dollars in lieu of thecompensation enumerated in Section Four, Paragraph 1. In the event of a miscarriage or stillbirth as described above, this agreement shallterminate, and neither Surrogate nor Natural Father shall be under any further obligation under this Agreement.  CLAUSE ELEVEN Surrogate and Natural Father shall each undergo complete physical and genetic examination and evaluation, under the direction andsupervision of a licensed physician, to determine whether the physical health and well-being of each is satisfactory. Such physicalexamination shall include testing for AIDS and venereal diseases including, but not limited to, syphilis, herpes, and gonorrhea. Such AIDSand venereal disease testing shall be done prior to, but not limited to, each series of inseminations.  CLAUSE TWELVE In the event that pregnancy has not occurred within a reasonable time in the opinion of Natural Father, this Agreement shall terminateby written notice to Surrogate, at the residence provided to the Custodian by the Surrogate (from Custodian, as representative of theNatural Father).  CLAUSE THIRTEEN Surrogate agrees she will not abort the child once conceived except if, in the professional medical opinion of the inseminatingphysician, such action is necessary for the physical health of Surrogate or the child has been determined by such physician to bephysiologically abnormal. Surrogate further agrees, at the request of such physician, to undergo amniocentesis or similar tests to detectgenetic and congenital defects. In the event such test reveals the fetus is genetically or congenitally abnormal, Surrogate agrees toabort the fetus on demand of Natural Father. The fee paid to Surrogate in this circumstance will be in accordance to Section Ten. IfSurrogate refuses to abort the fetus upon demand of Natural Father, Natural Father's obligations, as stated in this Agreement, shallcease except as to obligations of paternity imposed by statute.Natural Father recognizes that some genetic and congenital abnormalities may not be detected by amniocentesis or other tests, and,therefore, if proven to be the biological father, assumes the legal responsibility for any child who may possess genetic or congenitalabnormalities. CLAUSE FOURTEEN Surrogate agrees to adhere to all medical instructions given her by the inseminating physician as well as her independentobstetrician. Surrogate also agrees not to smoke cigarettes, drink alcoholic beverages, use illegal drugs, or take prescription ornonprescription medications without written consent from her physician. Surrogate agrees to follow a prenatal medical examination scheduleto consist of no fewer visits than: one (1) visit per month during the first ____________ (____) (Seven or as the Case May Be) monthsof pregnancy, two (2) visits (each to occur at two-week intervals) during the __________ (_____) and _________ (______) (Eighth andNinth or as the Case May Be) months of pregnancy.  CLAUSE FIFTEEN Prior to signing this Agreement, each party has been given the opportunity to consult an attorney of his or her own choice concerningthe terms and legal significance of the agreement and the effect it has upon any and all interests of the parties to this Agreement.  CLAUSE SIXTEEN Each party acknowledges that he or she has carefully read and understands every word in this Agreement, realizes its legal effect, andis signing this agreement freely and voluntarily. None of the parties has any reason to believe the other party or parties did notunderstand fully the terms and effects of this Agreement, or that the other parties did not freely and voluntarily execute thisAgreement.  CLAUSE SEVENTEEN In the event any of the provisions of this Agreement are deemed to be invalid or unenforceable, such invalid or unenforceableprovision may be severed from the remainder of this Agreement and shall not cause the invalidity or unenforceability of the reminder ofthis Agreement. If such provision shall be deemed invalid due to its scope or breadth, then such provision shall be deemed valid tothe extent of the scope or breadth permitted by law.  CLAUSE EIGHTEEN This Agreement shall be executed in three copies, each of which shall be deemed an original. One copy shall be given to Custodian,another copy to Natural Father, and the third copy to Surrogate.  CLAUSE This instrument embodies the entire Agreement of the parties with respect to the subject matter of surrogate parenting. There are nopromises, terms, conditions, or obligations other than those contained in this Agreement, and this Agreement shall supersede allprevious communications, representations, or agreements, either verbal or written, among the parties.  CLAUSE TWENTY This Agreement cannot be modified except by written agreement signed by all the original parties.  CLAUSE TWENTY-ONE This Agreement has been drafted, negotiated, and executed and shall be governed by, and enforced in accordance with, the laws of the State of ______________________._______________________________ ___________________Signature of Surrogate Mother Date_______________________________ ___________________Signature of Surrogate's Husband Date_______________________________ ___________________Signature of Natural Father Date

Memorandum Recording Family Settlement THIS MEMORANDUM RECORDING ORAL FAMILY SETTLEMENT  is made at _________ this ________ day of ____________ between Shri ____________ an Indian inhabitant residing at __________ _________ _________ (hereinafter called " the Party of the First Part ") of the  FIRST PART , Shri ______________, an Indian inhabitant residing at _____________ _____________ (hereinafter called "the Party of the Second Part") of the  SECOND PART  and Shri _________, also an Indian inhabitant residing at ____________________________________ (hereinafter called "the Party of the Third Part") of the  THIRD PART. and reference to the parties hereto shall, unless repugnant to the context or meaning thereof mean and include their respective successors and assigns. WHEREAS:- 1.     The parties hereto are related to each other, the party of the first part being the ____________ of the party of the Second Part etc; 2.     Serious disputes and differences have arisen between the parties hereto, relating to ___________, and which have disrupted the peace and harmony of the family and affected the business and family relations and threatened to resort to litigation; 3.     With the object of resolving the aforesaid disputes arising out of the conflicting claims made by the parties hereto as stated above and for effectuating a permanent solution of all the outstanding disputes once and for settlement was arrived at for ensuring family peace and harmony after considering what was best in the interest of the parties and in expectation that the settlement would result in achieving amity and goodwill among the Parties and it was agreed that the parties and it was agreed that the settlement arrived at would be final and binding upon all the parties hereto and avoid any further disputes and or differences amongst the parties hereto. 4.     The parties hereto, have come to a settlement after the aforesaid discussion with the help of mutual friends to resolve the disputes and differences, and a memorandum of settlement with certain terms and conditions was drawn with a view to avoid any future disputes and or differences amongst the parties hereto and that this memorandum has been entered into to record the said terms and conditions of the Family Settlement already agreed upon by the parties hereto. NOW THEREFORE THIS MEMORANDUM OF FAMILY SETTLEMENT WITNESSETH THE SAID TERMS AND CONDITIONS AS FOLLOWS: 1.     In pursuance of the said agreement and in consideration of the premises, the parties hereto agree that the Party of the Third Part shall apply to the Court for grant of letters of administration with the will annexed of the estate of the late ___________, the deceased. 2.     Without prejudice to their right to get their shares in the estate of the deceased as hereinafter fixed and agreed to by the parties hereto, the heirs shall give their letters of consent to the Party of the Third Part for obtaining the letters of administration as aforesaid. 3.     In consideration of the premises, the Party of the Third Part shall immediately after the letters of administration have been obtained grant, deliver and transfer one-third of the said properties and assets (after setting apart a sum of Rs. ___________/- for discharging the liabilities of the late _____________ and also to meet the expenses for the grant of letters of administration in favour of the Party of the Third Part.) to each of the said heirs and retain the remaining one-third for himself. 4.     An inventory of the assets of the deceased and of the respective agreed values thereof, is listed in Part I of the annexure B, hereto. A list of the debts due and owing by the estate of the deceased is listed in Part II of the said Annexure B hereto. An estimated sum of Rs______ has been taken into consideration and set apart by the Parties in a separate Savings Bank Account no. with __________ Bank, _____________ Branch, towards the expenses of obtaining the Probate / Letters of Administration with the will annexed and the transfer / distribution of the estate of the deceased in accordance herewith and the said sum shall be utilized by the parties hereto, accordingly. In case of any deficit in meeting the debts of the deceased and/ or the expenses of proving the Will and distribution of the estate, the parties hereto, shall contribute equally to such deficit. 5.     After setting apart sums to meet the debts of the deceased and the estimated expenses of distribution of the estate, The assets allotted to the said the Party of the First Part pursuant to the Family Settlement arrived at are more particularly described in the First Schedule hereunder written. Similarly, The assets allotted to the said the Party of the Second Part pursuant to the Family Settlement arrived at are more particularly described in the Second Schedule hereunder written. The assets allotted to the Party of the Third Part pursuant to the Family Settlement arrived at are more particularly described in the Third Schedule hereunder written. 6.     All expenses of and incidental to the grant of letters of administration as also of transfer of the shares to the respective parties hereto shall come out of the estate of the deceased. 7.     It is expressly agreed by and between the parties hereto that the heirs shall not claim any rights under the said codicil and the Party of the Third Part shall not, after obtaining the letters of administration with the will annexed, claim any rights under the said will, save as hereinbefore provided. 8.     The parties hereto confirm and declare that all the disputes and differences between them are settled and that none of the parties has any further or other claim or demand of any nature whatsoever against the other or others of them. 9.     The parties hereto expressly agree and declare that they have arrived at this Family Arrangement in order to put an end to existing and future disputes between the parties and with a view to bring about amity and goodwill amongst them and with a view to maintaining peace and bring about harmony in the family. The parties hereto further agree and declare that the terms of the Memorandum of Family Settlement arrived at between them and recorded herein are fair and bona fide and in the interest of all the parties. 10.  The parties hereto shall sign and execute or cause to be signed and executed all such documents, deeds, writing and/or instructions as may be necessary to give effect to the Family Arrangement arrived at amongst the parties hereto. On ___________ and which is recorded in this Memorandum of Family Arrangement-cum-Compromise. Annexure 'A' (Copy to the Will) Annexure 'B' Part I:List of assets of the deceased and estimated agreed values Thereof. The first schedule hereinabove referred to (The assets allotted to the said the Party of the First Part) Part IV: List of Debts of the Deceased. The Second schedule hereinabove referred to (The assts allotted to the said the Party of the Second Part) The third schedule hereinabove referred to (The assets allotted to the said the Party of the Third Part) IN WITNESSES WHEREOF the parties hereto have hereunto set and subscribed their respective hands the day and year first hereinabove written. SIGNED AND DELIVERED by } the Party of the First Part } Shri.......................... } in the presence of ___________ } SIGNED AND DELIVERED by } the Party of the Second Part } Shri.......................... } in the presence of ___________ } SIGNED AND DELIVERED by } the Party of the Third Part } Shri......................... } in the presence of ____________ } Download Word Document In English. (Rs.30/-)

Adoption by a Widow of a Son THIS DEED OF ADOPTION is made at ......... this....... Day of .......... between Smt. A aged ....... years a Hindu by religion, residing at ......... hereinafter referred to as the party of the First Part, Mr. B residing at .......... A Hindu by religion, aged about........ Here in after referred to as the party of the Second part. WHEREAS: 1.     The party of the First Part's husband........ Died intestate on or about leaving the party of the First Part as his only heir and also a large estate. 2.     The party of the First Part has no issue and she, therefore, proposes to adopt a son so that he can look after her in old age and inherit her property. 3.     The party of the Second part who is a widower has two sons and offered to give his youngest son by name.......... Of the age 5 years in adoption to the party of the First Part. 4.     The party of the First Part approved the boy and agreed to take him in adoption. 5.     A ceremony was held on the ....... day of ....... at ......... when several persons were invited and present and in the presence of all, the party of the Second part put his son the said ......... on the lap of the party of the First Part with intention on the part of the party of the First Part to take him in adoption as her son and on the part of the party of the Second part to give him in adoption to the party of the First Part. 6.     It is now proposed to record the said factum of adoption in the manner following: NOW THEREFORE IT IS DECLARED AND RECORDED BY THE PARTIES HERETO AS FOLLOWS: 1.     The party of the First Part confirms that the said child by name son of the party of the Second part was taken by her in adoption as her son and the party of the Second part confirms that he handed over custody of the said child to the party of the First Part in the manner aforesaid with intention to give the child in adoption to the party of the First Part. 2.     The child will be hereafter known by the name of........ 3.     Three of the persons who were present on the said occasion have signed this deed as attesting witnesses to the signatures of the parties of the First Part and Second part. IN WITNESS WHEREOF the parties have put their respective hands the day and year first hereinabove written. Signed by the with in named Smt. A. ......... in the presence of 1.       2.       3.       Signed by the with in named Mr. B In the presence of 1.       2.       3.       Download Word Document In English. (Rs.15/-)

Creating Life Estate for the Maintenance of the Daughter In - Law by Way of Gift I............... s/o .................... r/o............... am the owner in possession of House No................. situated at .......................... As I am not keep well, and have attained old age and visualize property dispute after my death and as I am desirous to make some arrangement for the maintenance of my widow daughter-in-law Smt.............. W/o Late Sri............. R/o............. I hereby, out of my natural love and affection and also out of my free will and without force, compulsion or undue influence, make a gift of the entire above-noted premises in favor of my daughter-in-law for her lifetime. She shall exercise all rights in respect thereof and avail of all interest in respect therein during her lifetime. After the death of the said widowed daughter-in law of mine, the entire property gifted away by this document shall revert to my heirs in equal shares, I have put my widow daughter-in-law in possession of the said house gifted to her and therefore from today I have ceased to possess any right or claim in respect of the gifted property. I also state that the life estate created in Smt-------------- stands revoked if she re-marries and will then invest in the favor of my grandson Mr.-------s/o late------------r/o................ IN WITNESS WHEREOF I have signed this gift deed on ............... at........... Signed by the Donor............. In presence of Witnesses: 1................. 2................ Download Word Document In English. (Rs.15/-)

Download Word Document In English. (Rs.85/-) Germany Double Taxation Avoidance Agreement Notification under section 90: Agreement between the Government of the Republic of India and the Government of the Federal Republic of Germany for the avoidance of double taxation with respect to taxes on income and capital Notification No. S. O. 836(E), dtd. 29.11.1996. WHEREAS  the annexed Agreement between the Government of the Republic of India and the Government of the Federal Republic of Germany for the avoidance of double taxation with respect to taxes on income and capital has been concluded: AND WHEREAS  the aforesaid agreement was brought into force on the 26th day of October, 1996, after the completion by both the Contracting States to each other of the procedure required under their laws in accordance with 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 44A of the Wealth-tax Act, 1957 (27 of 1957), the Central Government hereby directs that all the provisions of the said Agreement shall be given effect to in the Union of India. AGREEMENT BETWEEN THE REPUBLIC OF INDIA AND THE FEDERAL REPUBLIC OF GERMANY FOR THE AVOIDANCE OF DOUBLE TAXATION WITH RESPECT TO TAXES ON INCOME AND CAPITAL WHEREAS  the Government of the Federal Republic of Germany and the Government of the Republic of India desire to conclude an Agreement for the avoidance of double taxation with respect to taxes on income and capital, and for promoting their mutual economic relations: NOW, THEREFORE , it is hereby agreed as follows: Article 1 PERSONAL SCOPE This Agreement shall apply to persons who are residents of one or both of the Contracting States. Article 2 TAXES COVERED 1.     This Agreement shall apply to taxes on income and on capital imposed on behalf of a Contracting State, of a land or political sub-division or local authority thereof, irrespective of the procedure in which they are levied. 2.     There shall be regarded as taxes on income and on capital all taxes imposed on total income, on total capital, or on elements of income or of capital, including taxes on gains from the alienation of movable or immovable property, and the pay roll tax. 3.     The existing taxes to which this Agreement shall apply are in particular: a.     In the Federal Republic of Germany: the Einkommensteuer (income-tax), the Korperschaftsteuer (corporation tax), the Vermogensteuer (capital tax), and the Gewerbesteuer (trade tax) (hereinafter referred to as "German tax") b.    In the Republic of India: the income-tax including any surcharge tax thereon (Einkommensteuer, einschl, darauf entfallender Zusatzsteuern), and the wealth-tax (Vermogensteuer) (hereinafter referred to as "Indian tax"). 4.     This Agreement shall apply also to any identical or substantially similar taxes which are imposed after the date of signature of this Agreement in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of changes of importance which have been made in their respective taxation laws. Article 3 GENERAL DEFINITIONS 1.     For the purposes of this Agreement, unless the context otherwise requires: a.     the term "Federal Republic of Germany" means the area in which the tax law of the Federal Republic of Germany is in force including the area of the sea-bed, its sub-soil and the superjacent water column adjacent to the territorial sea, in so far as the Federal Republic of Germany exercises their sovereign rights and jurisdiction in conformity with international law and its national legislation; b.    the term "Republic of India" means the territory of the Republic of India and includes the territorial sea and airspace above it. For the purposes of this Agreement the term shall also cover any other maritime zone in which the Republic of India has sovereign rights, other rights and jurisdictions, according to the Indian Law and in accordance with international law in particular as laid down in the UN Convention of the law of the Sea; c.     the terms "a Contracting State" and "the other Contracting State" mean the Federal Republic of Germany or the Republic of India as the context requires; d.    the term "person" includes an individual, a company and any other entity which is treated as a taxable unit under the taxation laws in force in the respective Contracting States; e.     the term "company" means any body corporate or any entity which is treated as a company or body corporate under the taxation laws in force in the respective Contracting States. f.     the term "immovable property" has the meaning which it has under the law of the Contracting State in which the property in question is situated. The term shall in any case include property accessory to immovable property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, sources and other natural resources ships, boats and aircraft shall not be regarded as immovable property; g.    the terms "enterprise of a Contracting State" and "enterprise of the other Contracting State" mean respectively an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State; h.     the term "national" means:                       i.        in respect of the Federal Republic of Germany any German within the meaning of Article 116, paragraph (1), of the Basic Law for the Federal Republic of Germany and any legal person, partnership and association deriving its status as such from the law in force in the Federal Republic of Germany;                      ii.        in respect of the Republic of India any national of the Republic of India and any legal person, partnership and association deriving its status as such from the law in force in the Republic of India; i.      the term "international traffic" means any transport by a ship or aircraft operated by an enterprise which has its place of effective management in a Contracting State except when the ship or aircraft is operated solely between places in the other Contracting State; j.      the term "competent authority" means in the case of the Federal Republic of Germany the Federal Ministry of Finance, and in the case of the Republic of India the Central Government in the Ministry of Finance (Department of Revenue) or its authorised representative; k.     the term "fiscal year" means:                       i.       in relation to Indian tax, the previous year as defined in the Income-tax Act, 1961;                      ii.       in relation to German tax, the calendar year; 2.     the term "tax" means German tax or Indian tax as the context requires but shall not include interest or penalty imposed in relation to such taxes. 3.     As regards the application of this Agreement by a Contracting State any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that State concerning the taxes to which this Agreement applies. Article 4 RESIDENT 1.     For the purposes of this Agreement, the term "resident of a Contracting State" means any person who, under the laws of that State, is liable to tax therein by reason of his domicile, residence, place of management or any criterion of a similar nature. But this term does not include any person who is liable to tax in that State in respect only of income from sources in that State or capital situated therein. 2.     Where by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his status shall be determined as follows: a.     he shall be deemed to be a resident of the State in which he has a permanent home available to him; if he has a permanent home available to him in both States, he shall be deemed to be a resident of the State with which his personal and economic relations are closer (centre of vital interests); b.    if the State in which he has his centre of vital interests cannot be determined, or if he has not a permanent home available to him in either Sate, he shall be deemed to be a resident of the State in which he has an habitual abode; c.     if he has an habitual abode in both States or in neither of them, he shall be deemed to be a resident of the State of which he is a national; d.    if he is a national of both States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement. 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 of the State in which its place of effective management is situated. Article 5 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" includes 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, including an installation or structure used for the exploration or exploitation; g.    a warehouse or sales outlet; h.     a farm, plantation or other place where agricultural, forestry, plantation or related activities are carried on; and i.      a building site or construction, installation or assembly project or supervisory activities in connection therewith, where such site, project or activities continue for a period exceeding six months. 3.     An enterprise shall be deemed to have a permanent establishment in a Contracting State and to carry on business through that permanent establishment if it provides services or facilities in connection with, or supplies plant and machinery on hire used for or to be used in the prospecting for or extraction or exploitation of mineral oils in that State. 4.     Notwithstanding the preceding provisions of this article, the term "permanent establishment" shall be deemed not to include: a.     the use of facilities solely for the purpose of storage, display or delivery 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, display or delivery; 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; e.     the maintenance of a fixed place of business solely for the purpose of carrying on, for the enterprise, any other activity of a preparatory or auxiliary character; f.     the maintenance of a fixed place of business solely for any combination of activities mentioned in sub-paragraphs (a) to (e), provided that the overall activity of the fixed place of business resulting from this combination is of a preparatory or auxiliary character. 5.     Notwithstanding the provisions of paragraphs 1 and 2, where a person --other than an agent of an independent status to whom paragraph 6 applies--is acting in a Contracting State on behalf of an enterprise of the other Contracting State that enterprise shall be deemed to have a permanent establishment in the first-mentioned State, if this person; a.     has and habitually exercises in that State an authority to conclude contracts on behalf of the enterprise, unless his activities are limited to the purchase of goods or merchandise for the enterprise; b.    has no such authority, but habitually maintains in the first mentioned State a stock of goods or merchandise from which he regularly delivers goods or merchandise on behalf of the enterprise; or c.     habitually secures orders in the first mentioned State wholly or almost wholly for the enterprise itself or for the enterprise and other enterprises controlling, controlled by, or subject to the same common control, as that enterprise. 6.     An enterprise shall not be deemed to have a permanent establishment in a Contracting State merely because it carries on business in that State through a broker, general commission agent or any other agent of an independent status, provided that such persons are acting in the ordinary course of their business and in their commercial and financial relations to the enterprise no conditions are agreed or imposed which differ from those usually agreed between independent persons. 7.     The fact that a company which is a resident of a Contracting State 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 constitute either company a permanent establishment of the other. Article 6 INCOME FROM IMMOVABLE PROPERTY 1.     Income derived by a resident of a Contracting State from immovable property situated in the other Contracting State may be taxed in that other State. 2.     The provisions of paragraph 1 shall apply to income derive from the direct use, letting, or use in any other form of immovable property. 3.     The provisions of paragraphs 1 and 2 shall also apply to the income from immovable property of an enterprise and to income from immovable property used for the performance of independent personal services. Article 7 BUSINESS PROFITS 1.     The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable to that permanent establishment. 2.     Subject to the provisions of paragraph 3, where an enterprise of a Contracting State 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 a 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. 3.     In the determination of the profits of a permanent establishment, there shall be allowed as deductions, expenses which are incurred for the purposes of the business of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere, and according to the domestic law of the Contracting State in which the permanent establishment is situated. 4.     In so far as in a Contracting State and in exceptional cases the determination of the profits to be attributed to a permanent establishment in accordance with paragraph 2 is, impossible or gives rise to unreasonable difficulties, nothing in paragraph 2 shall preclude the determination of the profits to be attributed to a permanent establishment by means of either apportioning the total profits of the enterprise to that permanent establishment or estimating on any other reasonable basis; the method of apportionment or estimation adopted shall, however, be such that the result shall be in accordance with the principles contained in this article. 5.     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. 6.     For the purposes of the preceding paragraphs, 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. Article 8 SHIPPING AND AIR TRANSPORT 1.     Profits from the operation of ships or aircraft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 2.     If the place of effective management of a shipping enterprise is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident. 3.     For the purposes of this article, interest on funds connected with the operation of ships or aircraft in international traffic shall be regarded as profits derived from the operation of such ships or aircraft, and the provisions of Article 11 shall not apply in relation to such interest. 4.     The provisions of paragraph 1 shall also apply to profits from the participation in a pool, a joint business or an international operating agency. Article 9 ASSOCIATED ENTERPRISES Where-- a.     an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or b.    the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State, and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have accrued 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. Article 10 DIVIDENDS 1.     Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. 2.     However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident and according to the laws of that State, but if the recipient is the beneficial owner of the dividends, the tax so charged shall not exceed 10 per cent. of the gross amount of the dividends. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid. 3.     The term "dividends" as used in this article means-- a.     dividends on shares including income from shares, "jouissance" shares or "jouissance" rights, mining shares, founders' shares or other rights, not being debt-claims, participating in profits, and b.    other income which is subjected to the same taxation treatment as income from shares by the laws of the State of which the company making the distribution is a resident. 4.     The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, 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 or fixed base. In such a case the provisions of Article 7 or Article 14, as the case may be, shall apply. 5.     Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company, except insofar as such dividends are paid to a resident of that other State or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State, nor subject to the company's undistributed profits to a tax on the company's undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other State. Article 11 INTEREST 1.     Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2.     However, such interest may also be taxed in the Contracting State in which it arises and according to the laws of that State, but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed 10 per cent. of the gross amount of the interest. 3.     Notwithstanding the provisions of paragraphs 1 and 2-- a.     interest arising in the Federal Republic of Germany and paid to the Government of the Republic of India, the Reserve Bank of India, the Industrial Finance Corporation of India, the Industrial Development Bank of India, the Export-Import Bank of India, National Housing Bank and Small Industries Development Bank of India shall be exempt from German tax; b.    interest arising in the Republic of India and paid to the Government of the Federal Republic of Germany, the Deutsche Bundesbank, the Kreditanstat fur Wiederaufbau or the Deutsche Investitions-und Entwicklungsgesellschaft (DEG) and interest paid in consideration of a loan guaranteed by HERMES--Deckung shall be exempt from the Indian tax. 4.     The term "interest" as used in this article means income from debt-claims of every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor's profits, and in particular, income from Government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shall not be regarded as interest for the purpose of this article. 5.     The provisions of paragraphs 1, 2 and 3 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, 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 debt-claim in respect of which the interest is paid is effectively connected with such permanent establishment or fixed base. In such case the provisions of Article 7 or Article 14, as the case may be, shall apply. 6.     Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a land or political sub-division, a local authority or a resident of that State. Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment or fixed base, then such interest shall be deemed to arise in the State in which the permanent establishment or fixed base is situated. 7.     Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this article shall apply only to the last mentioned amount. In such case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Agreement. Article 12 ROYALTIES AND FEES FOR TECHNICAL SERVICES 1.     Royalties and fees for technical services arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2.     However, such royalties and fees for technical services may also be taxed in the Contracting State in which they arise and according to the laws of that State, but if the recipient is the beneficial owner of the royalties, or fees for technical services, the tax so charged shall not exceed 10 per cent. of the gross amount of the royalties or the fees for technical services. 3.     The term "royalties" as used in this article means payments of any kind receive a consideration for the use of or the right to use, any copyright of literary, artistic or scientific work, including cinematograph films or films or tapes used for radio or television broadcasting, any patent, trade mark, design or model, plan, secret formula or process, or for the use of, or the right to use, industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience. 4.     The term "fees for technical services" as used in this article means payments of any amount in consideration for the services of managerial, technical or consultancy nature, including the provision of services by technical or other personnel, but does not include payments for services mentioned in Article 15 of this Agreement. 5.     The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties or fees for technical services, being a resident of a Contracting State, carries on business in the other Contracting State in which the royalties or fees for technical services arise, through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right, property or contract in respect of which the royalties or fees for technical services are paid is effectively connected with such permanent establishment or fixed base. In such case, the provisions of Article 7 or Article 14, as the case may be, shall apply. 6.     Royalties and fees for technical services shall be deemed to arise in a Contracting State when the payer is that State itself, a land or political sub-division, a local authority or a resident of that State. Where, however, the person paying the royalties or fees for technical services, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the royalties or fees for technical services was incurred, and such royalties or fees for technical services are borne by such permanent establishment or fixed base, then such royalties or fees for technical services shall be deemed to arise in the State in which the permanent establishment or fixed base is situated. 7.     Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of royalties or fees for technical services paid exceeds the amount which would have been paid in the absence of such relationship, the provisions of this article shall apply only to the last-mentioned amount. In such case, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Agreement. Article 13 CAPITAL GAINS 1.     Gains derived by a resident of a Contracting State from the alienation of immovable property situated in the other Contracting State may be taxed in that other State. 2.     Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, including such gains from the alienation of such a permanent establishment (alone or with the whole enterprise) or of such fixed base, may be taxed in that other State. 3.     Gains from the alienation of ships or aircraft operated in international traffic or movable property pertaining to the operation of such ships or aircraft shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 4.     Gains from the alienation of shares in a company which is a resident of a Contracting State may be taxed in that State. 5.     Gains from the alienation of any property other than that referred to in paragraphs 1 to 4 shall be taxable only in the Contracting State of which the alienator is a resident. Article 14 INDEPENDENT PERSONAL SERVICES 1.     Income derived by an individual who is a resident of a Contracting State from the performance of professional services or other independent activities of a similar character shall be taxable only in that State except in the following circumstances when such income may also be taxed in the other Contracting State: a.     if he has a fixed base regularly available to him in the other Contracting State for the purpose of performing his activities, in that case, only so much of the income as is attributable to that fixed base may be taxed in that other State; or b.    if his stay in the other Contracting State is for a period or periods amounting to or exceeding in the aggregate 120 days in the relevant fiscal year; in that case, only so much of the income as is derived from his activities performed in that other State may be taxed in that other State. 2.     The term "professional services" includes independent scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, surgeons, lawyers, engineers, architects, dentists and accountants. Article 15 DEPENDENT PERSONAL SERVICES 1.     Subject to the provisions of Articles 16, 18, 19 and 20, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable in the other Contracting State only if the employment is exercised there. 2.     Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if a.     the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the fiscal year concerned, and b.    the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State, and c.     the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State. 3.     Notwithstanding the preceding provisions of this article, remuneration derived in respect of an employment exercised aboard a ship or aircraft operated in international traffic may be taxed in the Contracting State of which the enterprise operating the ship or aircraft is a resident. Article 16 DIRECTORS' FEES Directors' fees and similar payments derived by a resident of a Contracting State in his capacity, as a member of the board of directors of a company which is a resident of the other Contracting State may be taxed in that other State. Article 17 ARTISTS AND SPORTSPERSONS 1.     Notwithstanding the provisions of Articles 7, 14 and 15, income derived by a resident of a Contracting State as an entertainer, such as a theatre, motion picture, radio or television artiste, or a musician, or as a sportsperson, from his personal activities as such exercised in the other Contracting State, may be taxed in that other State. 2.     Where income in respect of personal activities exercised by an entertainer or a sportsperson in his capacity as such accrues not to the entertainer or sportsperson himself but to another person, that income may, notwithstanding the provisions of Articles 7, 14, and 15, be taxed in the Contracting State, in which the activities of the entertainer or sportsperson are exercised. 3.     However, such income shall not be taxed in the State mentioned in paragraph 1 if the said activities are exercised during a visit to that State by a resident of the other Contracting State and where such visit is financed directly or indirectly by that other State, a land, a political subdivision or a local authority thereof or by an organisation which in that other State is recognised as a charitable organisation. Article 18 NON-GOVERNMENT PENSIONS Subject to the provisions of Article 19, pensions and other similar remuneration paid to a resident of a Contracting State in consideration of past employment shall be taxable only in that State. Article 19 GOVERNMENT SERVICE 1.       a.     Remuneration other than a pension, paid by a Contracting State, a land, a political sub-division or a local authority thereof to an individual in respect of services rendered to that State, land, sub-division or authority shall be taxable only in that State. b.    However, such remuneration shall be taxable only in the other Contracting State, if the services are rendered in that State and the individual is a resident of that State who:                       i.        is a national of that State; or                      ii.        did not become a resident of that State solely for the purpose of rendering the services. 2.     a.     Any pension paid by a Contracting State, a land, a political sub-division or a local authority thereof to an individual in respect of services rendered to that State, land, sub-division or authority shall be taxable only in that State. b.    However, such pension shall be taxable only in the other Contracting State if the individual is a resident of and a national of that other State. 3.     The provisions of Articles 15, 16 and 18 shall apply to remuneration and pensions in respect of services rendered in connection with a business carried on by a Contracting State, a land, a political sub-division or a local authority thereof. 4.     The provisions of paragraph 1 shall likewise apply in respect of remuneration paid, under a development assistance programme of a Contracting State, a land, a political sub-division or a local authority thereof, out of funds exclusively supplied by that State, land, political sub-division or local authority, to a specialist or volunteer seconded to the other Contracting State with the consent of that other State. Article 20 TEACHERS, STUDENTS AND TRAINEES 1.     An individual who visits a Contracting State at the invitation of that State or of a university, college, school, museum or other cultural institution of that State or under an official programme of cultural exchange for a period not exceeding two years solely for the purpose of teaching, giving lectures or carrying out research at such institution and who is, or was immediately before that visit, a resident of the other Contracting State shall be exempt from tax in the first-mentioned State on his remuneration for such activity during the period of the first year from the date of his arrival and in the next year the exemption will be only in respect of remuneration derived by him from outside that State. 2.     An individual who is present in a Contracting State solely: a.     as a student at a university, college or school in that Contracting State; b.    as a business apprentice (including in the case of the Federal Republic of Germany a "Volontar" or a "Praktikant"); c.     as the recipient of a grant, allowance or award for the primary purpose of study or research from a religious, charitable, scientific or educational organisation; or, d.    as a member of a technical co-operation programme entered into by the Government of that Contracting State, and who is, or was immediately before visiting that State, a resident of the other Contracting State, shall be exempt from tax in the first-mentioned Contracting State in respect of--                                           i.    remittances from abroad for the purposes of his maintenance, education or training; and                                          ii.    remuneration from employment in that other State, in an amount not exceeding DM 7,200 (seven thousand two hundred Deutsche Mark) or its equivalent in Indian currency during any fiscal year, as the case may be, provided that such employment is directly related to his studies or is undertaken for the purpose of his maintenance. Article 21 OTHER INCOME 1.     Items of income of a resident of a Contracting State, wherever arising, not dealt within the foregoing articles of this Agreement shall be taxable only in that State. 2.     The provisions of paragraph 1 shall not apply to income, other than income from immovable property, if the recipient of such income, being a resident of a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right of property in respect of which the income 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. 3.     Notwithstanding the provisions of paragraph 1, if a resident of a Contracting State derives income from sources within the other Contracting State in the form of lotteries, crossword puzzles, races including horse races, card games and other games of any sort of gambling or betting of any form or nature whatsoever, such income may be taxed in the other Contracting State. Article 22 CAPITAL 1.     Capital represented by immovable property, owned by a resident of a Contracting State and situated in the other Contracting State, may be taxed in that other State. 2.     Capital represented by movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or by movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, may be taxed in that other State. 3.     Capital represented by ships and aircraft operated in international traffic and by movable property pertaining to the operation of such ships or aircraft, shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 4.     All other elements of capital of a resident of a Contracting State shall be taxable only in that State. Article 23 RELIEF FROM DOUBLE TAXATION 1.     Tax shall be determined in the case of a resident of the Federal Republic of Germany as follows: a.     Unless foreign tax credit is to be allowed under sub-paragraph (b), there shall be exempted from German tax any item of income arising in the Republic of India and any item of capital situated within the Republic of India, which, according to this Agreement, may be taxed in the Republic of India. The Federal Republic of Germany, however, retains the right to take into account in the determination of its rate of tax the items of income and capital so exempted. In the case of dividends exemption shall apply only to such dividends as are paid to a company (not including partnerships) being a resident of the Federal Republic of Germany by a company being a resident of the Republic of India at least 10 per cent. of the capital of which is owned directly by the German company. There shall be exempted from taxes on capital any shareholding the dividends of which are exempted or, if paid, would be exempted, according to the immediately foregoing sentence. b.    Subject to the provisions of German tax law regarding credit for foreign tax, there shall be allowed as a credit against German tax payable in respect of the following items of income arising in the Republic of India and the items of capital situated there, the Indian tax paid under the laws of the Republic of India and in accordance with this Agreement on:                                           i.    dividends not dealt with in sub-paragraph (a);                                          ii.    interest;                                         iii.    royalties and fees for technical services;                                         iv.    income in the meaning of paragraph 4 of Article 13;                                          v.    directors' fees;                                         vi.    income of artistes and sportspersons. c.     For the purpose of credit referred to in letter (ii) of sub-paragraph (b) the Indian tax shall be deemed to be 10 per cent. of the gross amount of the interest, if the Indian tax is reduced to a lower rate or totally waived according to domestic law, irrespective of the amount of tax actually paid. d.    The provisions of sub-paragraph (c) shall apply for the first 12 fiscal years for which this Agreement is effective. e.     Notwithstanding the provisions of sub-paragraph (a) items of income dealt with in Articles 7 and 10 and gains derived from the alienation of the business property of a permanent establishment as well as the items of capital underlying such income shall be exempted from German tax only if the resident of the Federal Republic of Germany can prove that the receipts of the permanent establishment or company are derived exclusively or almost exclusively from active operations. In the case of items of income dealt with in Article 10 and the items of capital underlying such income the exemption shall apply even if the dividends are derived from holdings in other companies being residents of the Republic of India which carry on active operations and in which the company which last made a distribution has a holding of more than 25 per cent. Active operations are the following: Producing or selling goods or merchandise, giving technical advice or rendering engineering services, or doing banking or insurance business, within the Republic of India. If this is not proved, only the credit procedure as per sub-paragraph (b) shall apply. 2.     Tax shall be determined in the case of a resident of the Republic of India as follows: Where a resident of the Republic of India derives income or owns capital which, in accordance with the provisions of this Agreement, may be taxed in the Federal Republic of Germany, the Republic of India shall allow as a deduction from the tax on such income of that resident an amount equal to the income-tax paid in the Federal Republic of Germany, whether directly or by deduction, and as a deduction from the tax on such capital of that resident an amount equal to the capital tax paid in the Federal Republic of Germany. Such deduction in either case shall not, however, exceed that part of the income-tax or capital tax (as computed before the deduction is given) which is attributable, as the case may be, to the income or the capital which may be taxed in the Federal Republic of Germany. 3.     The laws in force in either of the Contracting States shall continue to govern the taxation of income and capital in the respective Contracting States except where express provision to the contrary is made in this Agreement. Article 24 NON-DISCRIMINATION 1.     Nationals of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which nationals of that other State in the same circumstances and under the same conditions are or may be subjected. This provision shall, notwithstanding the provisions of Article 1, also apply to persons who are not residents of one or both of the Contracting States. 2.     The taxation of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall not be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same activities. This provision shall not be construed as preventing a Contracting State from charging the profits of a permanent establishment which a company of the other Contracting State has in the first-mentioned State at a rate of tax which is higher than that imposed on the profits of a similar company of the first-mentioned Contracting State, nor as being in conflict with the provisions of paragraph 3 of Article 7 of this Agreement. Further, this provision shall not be construed as obliging a Contracting State to grant to residents of the other Contracting State any personal allowances, reliefs and reductions for taxation purposes which it grants only to its own residents. 3.     Except where the provisions of Article 9, paragraph 7 of Article 11, or paragraph 7 of Article 12, apply, interest, royalties and other disbursements paid by an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purpose of determining the taxable profits of such enterprise, be deductible under the same conditions as if they had been paid to a resident of the first-mentioned State. Similarly, any debts of an enterprise of a Contracting State to a resident of the other Contracting State shall, for the purpose of determining the taxable capital of such enterprise, be deductible under the same conditions as if they had been contracted to a resident of the first-mentioned State. 4.     Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of the other Contracting State, shall not be subjected in the first-mentioned State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of the first mentioned State are or may be subjected. Article 25 MUTUAL AGREEMENT PROCEDURE 1.     Where a person considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with the provisions of this Agreement, he may, irrespective of the remedies provided by the domestic law of those States, present his case to the competent authority of the Contracting State of which he is a resident or, if his case comes under paragraph 1 of Article 24, to that of the Contracting State of which he is a national. The case must be presented within three years from the first notification of the action resulting in taxation not in accordance with the provisions of this Agreement. 2.     The competent authority shall endeavour, if the objection appears to it to be justified and if it is not itself able to arrive at a satisfactory solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation which is not in accordance with this Agreement. Any agreement reached shall be implemented notwithstanding any time limits in the domestic law of the Contracting States. 3.     The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of this Agreement. They may also consult together for the elimination of double taxation in cases not provided for in this Agreement. 4.     The competent authorities of the Contracting States may establish by mutual agreement the mode of application of the provisions of this Agreement regarding the exemption or reduction of taxes. 5.     The competent authorities of the Contracting States may communicate with each other directly for the purpose of reaching an agreement in the sense of the preceding paragraphs. Article 26 EXCHANGE OF INFORMATION 1.     The competent authorities of the Contracting States shall exchange such information as is necessary for carrying out the provisions of this Agreement. Any information received by 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) involved in the assessment or collection of, the enforcement or prosecution in respect of, or the determination of appeals in relation to, the taxes covered by this Agreement. Such persons or authorities shall use the information only for such purposes. They may disclose the information in public court proceedings or in judicial decisions. 2.     In no case shall the provisions of paragraph 1 be construed so as to impose on a Contracting State the obligation: a.     to carry out administrative measures at variance with the laws and administrative practice of that or of the other Contracting State; 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 Contracting State; c.     to supply information which would disclose any trade, business, industrial, commercial or professional secret or trade process, or information, the disclosure of which would be contrary to public policy (order public) Article 27 DIPLOMATIC AND CONSULAR PRIVILEGES Nothing in this Agreement shall affect the fiscal privileges of members of a diplomatic mission, a consular post or an international organisation under the general rules of international law or under the provisions of special agreements. Article 28 ENTRY INTO FORCE 1.     The Governments of the Contracting States shall notify to each other that the legal requirements for the entry into force of this Agreement have been complied with. 2.     This Agreement shall enter into force one month after receipt of the latter of the notifications referred to in paragraph 1 and shall have effect: a.     In the Federal Republic of Germany:                                           i.    in the case of taxes withheld at source on dividends, interest, royalties and fees for technical services, in respect of amounts paid on or after the first day of January, of the calendar year next following that in which this Agreement enters into force;                                          ii.    in the case of other taxes, in respect of taxes levied for periods beginning on or after the first day of January, of the calendar year next following that in which this Agreement enters into force; b.    in the Republic of India:                                           i.    in respect of income arising in any fiscal year beginning on or after the first day of April, following the calendar year in which this Agreement enters into force;                                          ii.    in respect of capital which is held on the last day of any fiscal year beginning on or after the first day of April, following the calendar year in which this Agreement enters into force. 3.     Upon the entry into force of this Agreement the Agreement between the Government of the Federal Republic of Germany and the Government of India for the Avoidance of Double Taxation of income signed on 18th March, 1959, and the Protocol amending the Agreement between the Government of the Federal Republic of Germany and the Government of India for the Avoidance of Double Taxation of Income signed on 28th June, 1984, along with the Exchange of Notes of the same date shall expire and shall cease to have effect as from the date on which the provisions of this Agreement commence to have effect. Article 29 TERMINATION This Agreement shall continue in effect indefinitely but either of the Contracting States may, on or before the thirtieth day of June, in any calendar year beginning after the expiration of a period of five years from the date of its entry into force, give the other Contracting State, through diplomatic channels, written notice of termination and, in such event, this Agreement shall cease to have effect: a.     In the Federal Republic of Germany:                       i.        in the case of taxes withheld at source on dividends, interest, royalties and fees for technical services, in respect of amounts paid on or after the first day of January, of the calendar year next following that in which notice of termination is given;                      ii.        in the case of other taxes, in respect of taxes levied for periods beginning on or after the first day of January, of the calendar year next following that in which notice of termination is given; a.     In the Republic of India:                       i.        in respect of income arising in any fiscal year beginning on or after the first day of April, following the calendar year in which the notice of termination is given;                      ii.        in respect of capital which is held on the last day of any fiscal year beginning on or after the first day of April, following the calendar year in which the notice of termination is given. In witness whereof the undersigned being duly authorised thereto, have signed the present Agreement. Done at Bonn on June 19th 1995, in two originals, each in German, Hindi and English languages, all three texts being authentic. In case of divergent interpretation of

Download Word Document In English. (Rs.75/-) Romania Double Taxation Avoidance Agreement CONVENTION BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE SOCIALIST REPUBLIC OF ROMANIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME Notification No. G. S. R. 80(E), dtd. 08.02.1988. Notification No.7754 Whereas the annexed Convention between the Government of the Republic of India and the Government of the Socialist Republic of Romania for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income has come into force on the 14th November, 1987, on the exchange of the Instruments of Ratification by both the contracting States, as required by paragraph 1 of Article 31 of the said Convention; 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 Convention shall be given effect to in the Union of India. ANNEXURE CONVENTION BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE SOCIALIST REPUBLIC OF ROMANIA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME The Government of the Republic of India and the Government of the Socialist Republic of Romania desiring to conclude a Convention for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and to promote and strengthen the economic relations between the two countries on the basis of equality in rights and reciprocal advantage. Have agreed as follows: Article 1 PERSONAL SCOPE This Convention shall apply to persons who are residents of one or both of the Contracting States. Article 2 TAXES COVERED 1.     The taxes to which this Convention shall apply are: a.     In the case of India: 1.     Income-tax and any surcharge thereon; and 2.     Surtax; (hereinafter referred to as "Indian tax"). b.    In the case of Romania: 1.     the tax on incomes derived by individuals and corporate bodies; 2.     the tax on the profits of joint companies constituted with the participation of some Romanian economic organisations and some foreign partners; and 3.     the tax on income realised from agricultural activities; (hereinafter referred to as "Romanian tax"). 2.     The Convention shall also apply to any identical or substantially similar taxes which are imposed by either Contracting State after the date of signature of the present Convention in addition to, or in place of, the taxes referred to in paragraph 1. 3.     The competent authorities of the Contracting States shall notify to each other any significant changes which are made in their respective taxation laws which are the subject of this Convention and furnish copies of relevant enactments and regulations. Article 3 GENERAL DEFINITIONS 1.     In this Convention, unless the context otherwise requires: a.     the term "India" means the territory of India and includes the territorial sea and 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; b.    the term "Romania" used in a geographical sense, means the territory of the Socialist Republic of Romania including the territorial sea and the continental shelf as well as any other area beyond the territorial waters of Romania where Romania exercises sovereign rights, in accordance with the international law and with its own law concerning the exploration and exploitation of the natural, biological and mineral resources existing in the sea, waters, seabed and subsoil of these waters c.     the terms "a Contracting State" and "the other Contracting State" mean India or Romania as the context requires; d.    the term "tax" means Indian tax or Romanian tax, as the context requires, but shall not include any amount which is payable in respect of any default or omission in relation to the taxes to which this Convention applies or which represents a penalty imposed relating to those taxes; e.     the term "person" shall have the meaning assigned to it in the taxation laws in force in the respective Contracting States; f.     the term "company" means any body corporate, including a joint company which is incorporated under the Romanian law or any entity which is treated as a company under the taxation laws of the respective Contracting States; g.    the term "enterprise of a Contracting State" and "enterprise of the other Contracting State" mean, respectively, an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State; h.     the term "competent authority" means in the case of India the Central Government in the Ministry of Finance (Department of Revenue) or their authorised representative, and in the case of Romania the Ministry of Finance or its authorised representative; i.      the term "national" means:- in the case of India, any individual possessing the nationality of India and any legal person, partnership or association deriving its status from the laws in force in India; in the case of Romania, any individual possessing the citizenship of Romania and any legal person, partnership or association deriving its status from the laws in force in Romania: j.      the term "a political sub-division" means a political sub-division in India; k.     the term "an administrative territorial unit" means an administrative territorial unit in Romania; l.      the term "international traffic" means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State. 2.     In the application of the provisions of this Convention by one of the Contracting States, any term not defined herein shall, unless the context otherwise requires, have the meaning which it has under the laws in force in that State relating to the taxes which are the subject of this Convention. Article 4 FISCAL DOMICILE 1.     For the purposes of this Convention, the term "resident of a Contracting State" means any person who is a resident of that State in accordance with the taxation laws of that State. 2.     Where by reason of the provision of paragraph 1, an individual is a resident of both Contracting States, then, his residential status for the purposes of this Convention shall be determined in accordance with the following rules:- a.     He shall be deemed to be a resident of the Contracting State in which he has a permanent home available to him. If he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (hereinafter referred to as his "centre of vital interests"); b.    If the Contracting States in which he has his centre of vital interests cannot be determined or if he does not have a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; c.     If he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the Contracting State of which he is a national; d.    If he is a national of both Contracting States or of neither of them, the competent authorities of the Contracting States shall settle the question by mutual agreement. 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 of the Contracting State in which its place of effective management is situated. Article 5 PERMANENT ESTABLISHMENT 1.     For the purposes of this Convention, the term "Permanent establishment" means a fixed place of business through which the business of the enterprise is wholly or partly carried on. 2.     The term "permanent establishment" includes 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 agriculture, forestry, plantation or related activities are carried on; i.      a premises used as a sales outlet or for receiving or soliciting orders; j.      an installation or structure used for the exploration of natural resources; k.     a building site or construction, installation or assembly project or supervisory activities in connection therewith, where such site, project or supervisory activity (together with other such sites, projects or activities, if any) continues for a period of more than six months, or where such project or supervisory activity, being incidental to the sale of machinery or equipment, continues for a period not exceeding six months and the charges payable for the project or supervisory activity exceed 10 per cent. of the sale price of the machinery or equipment. 3.     Notwithstanding the preceding provisions of this article, the term "permanent establishment" shall be deemed not to include; 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 for collecting the information for the enterprise; 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; f.     the selling of goods or merchandise belonging to the enterprise displayed in an occasional temporary fair or exhibition in the process of closing down of such fair or exhibition; g.    project or supervisory activity, being incidental to sale of machinery or equipment, carried on by an enterprise other than the seller of machinery or equipment and not continuing for a period exceeding six months. However, the provisions of sub-paragraphs (a) to (g) shall not be applicable where the enterprise maintains any other fixed place of business in the other Contracting State for any purposes other than the purposes specified in the said sub-paragraphs. 4.     Notwithstanding the provisions of paragraphs 1 and 2 where a person-other than an agent of an independent status to whom paragraph 5 applies-is acting in a Contracting State on behalf of an enterprise of the other Contracting State, that enterprise shall be deemed to have a permanent establishment in the first-mentioned State, if: a.     he has and habitually exercises in that State an authority to conclude contracts on behalf of the enterprise, unless his activities are limited to the purchase of goods or merchandise for the enterprise; b.    he has no such authority, but habituallty maintains in the first-mentioned State a stock of goods or merchandise from which he regularly delivers goods or merchandise on behalf of the enterprise; or c.     he habitually secures orders in the first-mentioned state, wholly or almost wholly for the enterprise itself or for the enterprise and other enterprises controlling, controlled by, or subject to the same common control as, that enterprise. 5.     An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carried on business in that other State through a broker, general commission agent or any other agent of an independent status provided that such persons are acting in the ordinary course of their business. However, when the activities of such an agent are devoted wholly or almost wholly on behalf of that enterprise itself or on behalf of that enterprise and other enterprises controlling, controlled by, or subject to the same common control as, that enterprise, he will not be considered an agent of an independent status within the meaning of this paragraph. 6.     The fact that a company which is a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting state, or which carried on business in that other Contracting State (whether through a permanent establishment or otherwise), shall not of itself constitute either company a permanent establishment of the other. Article 6 INCOME FROM IMMOVABLE PROPERTY 1.     Income from immovable property may be taxed only in the Contracting State in which such property is situated. 2.     The term "immovable property" shall be defined in accordance with the law and usage of the Contracting State in which the property is situated. The term shall in any case include property accessory to immovable property, livestock and equipment used in agriculture and forestry, rights to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, oil wells, quarries and other places of extraction of natural resources. Ships and aircraft shall not be regarded as immovable property. 3.     The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property. 4.     4.The provisions of paragraphs 1 and 3 shall also apply to income from immovable property of an enterprise and to income from immovable property used for the performance of independent personal services. Article 7 BUSINESS PROFITS 1.     The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable to (a) that permanent establishment; (b) sales in that other State of goods or merchandise of the same or similar kind as those sold through that permanent establishment; or (c) other business activities carried on in that other State of the same or similar kind as those effected through that permanent establishment. 2.     Subject to the provisions of paragraph 3, where an enterprise of a Contracting State 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 a 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. In any case where the correct amount of profits attributable to a permanent establishment is incapable of determination or the determination thereof presents exceptional difficulties, the profits attributable to the permanent establishment may be estimated on a reasonable basis. 3.     In the determination of the profits of a permanent establishment, there shall be allowed as deductions expenses which are incurred for the purposes of the business of the permanent establishment including executive and general administrative expenses so incurred whether in the State in which the permanent establishment is situated or elsewhere, in accordance with the provisions of the taxation laws of that State. However, no such deduction shall be allowed in respect of amounts, if any, paid (otherwise than towards reimbursement of actual expenses) by the permanent establishment to the head office of the enterprise or any of its other offices, by way of royalties, fees or other similar payments in return for the use of patents, know-how or other rights, or by way of commission or other charges, for specific services performed or for management, or except in the case of a banking enterprise, by way of interest on moneys lent to the permanent establishment. Likewise, no account shall be taken, in the determination of the profits of a permanent establishment, for amounts charged (otherwise than towards reimbursement of actual expenses), by the permanent establishment to the head office of the enterprise or any of its other offices, by way of royalties, fees or other similar payments in return for the use of patents, know-how or other rights, or by way of commission or other charges for specific services performed or for management, or except in the case of a banking enterprise, by way of interest on moneys lent to the head office of the enterprise or any of its other offices. 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.     For the purposes of the preceding paragraphs, 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. 6.     Where profits include items of income which are dealt with separately in other articles of this Convention, then the provisions of those articles shall not be affected by the provisions of this article. Article 8 AIR TRANSPORT 1.     Profits derived by an enterprise of a Contracting State from the operation of aircraft in international traffic shall be taxable only in that State. 2.     The provisions of paragraph 1 shall also apply to profits from the participation in a pool, a joint business or an international operating agency. 3.     For the purposes of this article, interest on funds connected with the operation of aircraft in international traffic shall be regarded as profits derived from the operation of such aircraft, and the provisions of article 12 shall not apply in relation to such interest. 4.     The term "operation of aircraft" shall mean business of transportation by air of passengers, mail, livestock or goods carried on by the owners or lessees or charterers of aircraft, including the scale of tickets for such transportation on behalf of other enterprises, the incidental lease of aircraft and any other activity directly connected with such transportation. Article 9 SHIPPING 1.     Profits derived by an enterprise of a Contracting State from the operation of ships in international traffic shall be taxable only in that State. 2.     Notwithstanding the provisions of paragraph 1, such profits may also be taxed in the other Contracting State if the shipping activities connected with the operation of ships in international traffic are carried on in that other State, but the tax so charged shall not exceed 2.50 per cent. of the gross amount payable in respect of operation of ships in that other State. 3.     The provisions of paragraphs 1 and 2 shall also apply to profits from the participation in a pool, a joint business or an international operating agency engaged in the operation of ships. 4.     For the purposes of this article, the gross amount payable in respect of operation of ships in a Contracting State shall mean the aggregate of the following amounts, namely:- a.     the gross amount payable on account of carriage of passengers, livestock, mail or goods shipped at a port or ports in that Contracting State; b.    interest arising in that Contracting State on funds connected with the operation of ships in international traffic; and c.     the gross amount payable in that State on account of the use, maintenance or rental of containers (including trailers and related equipment for the transport of containers) in connection with the transport of goods or merchandise in international traffic. The provisions of article 12 shall not apply in relation to interest referred to in (b) above. 5.     In determining the income of an enterprise of a Contracting State for the purposes of taxation in the other Contracting State, no deduction shall be allowed in respect of any loss or depreciation allowance admissible to that enterprise for any earlier "previous year" or "calendar year", as the case may be. Article 10 ASSOCIATED ENTERPRISES Where a.     an enterprise of a Contracting State participates directly or indirectly in the management control or capital of an enterprise of the other Contracting State, or b.    the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and an enterprise of the other Contracting State, and in either case conditions are made or imposed between the two enterprises in their commercial or financial relations which differ from those which would be made between independent enterprises, then only the profits which would, but for those conditions, have accrued 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. Article 11 DIVIDENDS 1.     Dividends paid by a company which is resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. 2.     However, such dividends may also be taxed in the Contracting state of which the company paying the dividends is a resident and according to the laws of that State, but if the recipient is the beneficial owner of the dividends, the tax so charged shall not exceed: a.     15 per cent. of the gross amount of the dividends if the beneficial owner is a company which owns at least 25 per cent. of the shares of the company paying the dividends; b.    20 per cent. of the gross amount of the dividends in all other cases. This paragraph shall not affect the taxation of the company in respect of the profits out of which the dividends are paid. 3.     The term "dividends" as used in this article means income from shares or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights which is subjected to the same taxation treatment as income from shares by the laws of the State of which the company making the distribution is a resident. In this context, the profits distributed by Romanian Joint Companies to the capital subscribers are assimilated to dividends. 4.     The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the dividends, being a resident of a Contracting State, 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 or fixed base. In such cases, the provisions of article 7 or article 16 as the case may be, shall apply. 5.     Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company except in so far as such dividends are paid to a resident of that other State or so far as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State, nor subject the company's undistributed profits to a tax on the company's undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other state. Article 12 INTEREST 1.     Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other state. 2.     However, such interest may also be taxed in the Contracting State in which it arises and according to the laws of that State, but if the recipient is the beneficial owner of the interest, the tax so charged shall not exceed 15 per cent. of the gross amount of the interest. 3.     Notwithstanding the provisions of paragraph 2,- a.     interest arising in a Contracting State shall be exempt from tax in that state provided it is derived and beneficially owned by:                       i.        the Government, a political sub-division, an administrative territorial unit, or a local authority of the other Contracting State; or                      ii.        the Central Bank of the other Contracting State; b.    interest arising in a Contracting State shall be exempt from tax in that state if it is beneficially owned by a resident of the other Contracting State and is derived in connection with a loan or credit extended or endorsed by:                       i.        in the case of Socialist Republic of Romania, BANCA ROMANA DE COMERT EXTERIOR to the extent such interest is attributable to financing of exports and imports only;                      ii.        in the case of India, the Export-Import Bank of India (Exim Bank), to the extent such interest is attributable to financing of exports and imports only;                     iii.        any institution of a Contracting State in charge of public financing of external trade;                     iv.        any other person provided that the loan or credit is approved by the Government of the first-mentioned Contracting State. 4.     The term "interest" as used in this article means income from debt- claims of every kind, whether or not secured by mortgage and whether or not carrying a right to participate in the debtor's profits, and in particular, income from Government securities and income from bonds or debentures, including premiums and prizes attaching to such securities, bonds or debentures. Penalty charges for late payment shall not be regarded as interest for the purpose of this article. 5.     The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the interest, being a resident of a Contracting State, 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 debt-claim in respect of which the interest is paid is effectively connected with such permanent establishment or fixed base. In such cases, the provisions of article 7 or article 16, as the case may be, shall apply. 6.     Interest shall be deemed to arise in a Contracting State when the payer is that Contracting State itself, a political sub-division, an administrative territorial unit, a local authority or a resident of that State. Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and such interest is borne by such permanent establishment or fixed base, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment or fixed base is situated. 7.     Where by reason a special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of the interest, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this article shall apply to the last-mentioned amount. In such cases, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this convention. Article 13 COMMISSION 1.     Commission arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2.     However, such commission may be taxed in the Contracting State in which it arises and according to the law of that State, but the tax so charged shall not exceed 5 per cent. of the amount of the commission. The competent authorities of the Contracting State shall, by mutual agreement, settle the mode of application of this limitation. 3.     The term "commission" as used in this article means a payment made to a broker, a general commission agent or to any other person assimilated to such a broker or agent by the taxation law of the Contracting state in which such payment arises. 4.     The provisions of paragraphs 1 and 2 shall not apply if the recipient of the commission, being a resident of a Contracting State, has in the other Contracting State in which the commission arises a permanent establishment with which the activity giving rise to the commission is effectively connected. In such a case, the provisions of article 7 shall apply. 5.     Commission shall be deemed to arise in a Contracting State when the payer is that State itself, a political sub-division, an administrative territorial unit, a local authority or a resident of that State. Where, however, the person paying the commission, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment in connection with which the activities for which the payment is made was incurred, and such commission is borne by such permanent establishment, then such commission shall be deemed to arise in the Contracting State in which the permanent establishment is situated. 6.     Where by reason of a special relationship between the payer and the recipient or between both of them and some other person, the amount of the commission, having regard to the transaction for which it is paid, exceeds the amount which would have been agreed upon by the payer and the recipient in the absence of such relationship, the provisions of this article shall apply only to the last mentioned amount. In such cases, the excess part of the payment shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Convention. Article 14 ROYALTIES AND FEES FOR TECHNICAL SERVICES 1.     Royalties and fees for technical services arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other state. 2.     However, such royalties and fees for technical services may also be taxed in the Contracting State in which they arise and according to the laws of that State but if the recipient is the beneficial owner of the royalties, or fees for technical services, the tax so charged shall not exceed 22.5 per cent. of the gross amount of the royalties or fees for technical services. 3.     The term "royalties" as used in this article means payments of any kind received as a consideration for the use of, or the right to use any copyright of literary, artistic or scientific work, including cinematograph films or films or tapes used for radio or television broadcasting any patent, trade mark, design or model, plan, secret formula or process, or for the use of, or the right to use, industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience. 4.     The term "fees for technical services" as used in this article means payments of any amount to any person other than payments to an employee of a person making payments, in consideration for the services of a managerial, technical or consultancy nature, including the provision of services of technical or other personnel. 5.     The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties or fees for technical services, being a resident of a Contracting State, carries on business in the other Contracting State in which the royalties or fees for technical services arise, through a permanent establishment situated therein, and performs in that other State independent personal services from a fixed base situated therein, and the right, property or contract in respect of which the royalties or fees for technical services are paid is effectively connected with such permanent establishment or fixed base. In such cases, the provisions of article 7 or article 16, as the case may be, shall apply. 6.     Royalties and fees for technical services shall be deemed to arise in a Contracting State when the payer is that State itself, a political sub-division, an administrative territorial unit, a local authority or a resident of that state. Where, however, the person paying the royalties or fees for technical services, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the liability to pay the royalties or fees for technical services was incurred, and such royalties or fees for technical services are borne by such permanent establishment or fixed base, then such royalties or fees for technical services shall be deemed to arise in the State in which the permanent establishment or fixed base is situated. 7.     Where, by reason of special relationship between the payer and the beneficial owner or between both of them and some other person, the amount of royalties or fees for technical services paid exceeds the amount which would have been paid in the absence of such relationship, the provisions of this article shall apply only to the last-mentioned amount. In such cases, the excess part of the payments shall remain taxable according to the laws of each Contracting State, due regard being had to the other provisions of this Convention. Article 15 CAPITAL GAINS 1.     Gains derived by a resident of a Contracting State from the alienation of immovable property referred to in article 6 and situated in the other Contracting State may be taxed in that other State. 2.     Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting state or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing independent personal services, including such gains from the alienation of such a permanent establishment (alone or with the whole enterprise) or of such fixed base, may be taxed in that other State. 3.     Gains arising from a capital asset being ships or aircraft operating in international traffic or movable property pertaining to the operation of such ships or aircraft by an enterprise of a Contracting state shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 4.     Gains from the alienation of shares of the capital stock of a company the property of which consists directly or indirectly principally of immovable property situated in a Contracting State may be taxed in that State. 5.     Gains from the alienation of any property other than that referred to in paragraphs 1,2,3 and 4 shall be taxable only in the Contracting State of which the alienator is a resident. Article 16 INDEPENDENT PERSONAL SERVICES 1.     Income derived by an individual who is a resident of a Contracting State from the performance of professional services or other independent activities of a similar character shall be taxable only in that State except in the following circumstances when such income may also be taxed in the other Contracting State: a.     if he has a fixed base regularly available to him in the other Contracting State for the purpose of performing his activities; in that case, only so much of the income as is attributable to that fixed base may be taxed in that other State; or b.    if his stay in the other Contracting State is for a period or periods amounting to or exceeding in the aggregate 183 days in the relevant "previous year" or "calendar year", as the case may be, in that case, only so much of the income as is derived from his activities performed in that other State may be taxed in that other state. 2.     The term "professional services" includes independent, scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, surgeons, lawyers, engineers, architects, dentists and accountants. Article 17 DEPENDENT PERSONAL SERVICES 1.     Subject to the provisions of articles 18, 19, 20, 21, 22 and 23, salaries, wages and other similar remuneration derived by a resident of Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in that other State. 2.     Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if: a.     the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the relevant "previous year" or "calendar year", as the case may be; and b.    the remuneration is paid by, or on behalf of, an employer who is not a resident of the other State; and c.     the remuneration is not borne by a permanent establishment or a fixed base which the employer has in the other State. 3.     Notwithstanding the preceding provisions of this article, remuneration derived in respect of an employment exercised aboard a ship or aircraft operating in international traffic by an enterprise of a Contracting State may be taxed in that State. Article 18 DIRECTORS' FEES AND REMUNERATION OF TOP LEVEL MANAGERIAL OFFICIALS 1.     Directors' fees and other similar payments derived by a resident of a Contracting State in his capacity as a member of the Board of Directors of a company which is a resident of the other Contracting State may be taxed in that other State. 2.     Salaries, wages and other similar remuneration derived by a resident of a Contracting State in his capacity as an official in a top-level managerial position of a company which is a resident of the other Contracting State may be taxed in that other State. Article 19 ARTISTES AND ATHLETES 1.     Notwithstanding the provisions of articles 16 and 17, income derived by a resident of Contracting State as an entertainer such as theatre, motion picture, radio or television artiste or a musician or as an athlete, from his personal activities as such exercised in the other Contracting State may be taxed in that other State. 2.     Where income in respect of personal activities exercised by an entertainer or athlete in his capacity as such accrues not to the entertainer or athlete himself but to another person, that income may, notwithstanding the provisions of articles 7, 16 and 17, be taxed in the Contracting State in which the activities of the entertainer or athlete are exercised. 3.     Notwithstanding the provisions of paragraph 1, income derived by an entertainer or an athlete who is a resident of a Contracting State from his 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, administrative territorial units or local authorities. 4.     Notwithstanding the provisions of paragraph 2 and articles 7, 16 and 17, where income in respect of personal activities exercised by an entertainer or an athlete in his capacity as such in a Contracting State accrues not to the entertainer or athlete himself 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, administrative territorial units or local authorities. Article 20 REMUNERATION AND PENSIONS IN RESPECT OF GOVERNMENT SERVICE 1.       a.     Remuneration, other than a pension, paid by a Contracting State, a political sub-division, an administrative territorial unit or a local authority thereof to an individual in respect of services rendered to that State, sub-division, unit or authority shall be taxable only in that State. b.    However, such remuneration shall be taxable only in the other Contracting State if the services are rendered in that other State and the in individual is a resident of that State who:                       i.        is a national of that State; or                      ii.        did not become a resident of that State solely for the purpose of rendering the services. 2.     a.     Any pension paid by, or out of funds created by a Contracting State, a political sub-division, an administrative territorial unit or a local authority thereof to an individual in respect of services rendered to that State, sub-division, unit or authority shall be taxable only in that State. b.    However, such pension shall be taxable only in the other Contracting State if the individual is a resident of, and a national of that other State. 3.     The provisions of articles 17, 18 and 19 shall apply to remuneration and pensions in respect of services rendered in connection with a business carried on by a Contracting State, a political sub-division, an administrative territorial unit or a local authority thereof. Article 21 NON-GOVERNMENT PENSIONS AND ANNUITIES 1.     Any pension, other than a pension referred to in article 20 or any annuity derived by a resident of Contracting State from sources within the other Contracting State may be taxed only in the first-mentioned Contracting State. 2.     The term "pension" means a periodic payment made in consideration of past services or by way of compensation for injuries received in the course of performance of services. 3.     The term "annuity" means a stated sum payable periodically as 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 money's worth. Article 22 STUDENTS, APPRENTICES AND PERSONS SENT FOR SPECIALISATION 1.     An individual who is or was resident of one of the other Contracting State and who is temporarily present in the other Contracting State solely: a.     as a student at a recognised university, college or school in that other State; or b.    as a business apprentice; or c.     as the recipient of a grant, allowance or award for the primary purpose of study from a religious, charitable, scientific, or educational organisation; shall be exempt from tax in that other State for a period of six years from his arrival in that other Contracting State in respect of -                               i.        the remittance from abroad for the purposes of his maintenance, education, study or training;                              ii.        the grant, allowance or award; and                             iii.        any remuneration from abroad. 2.     The same exemption shall apply to income derived by the above- mentioned individual from an employment which he exercises in the other Contracting State in order to supplement his means for maintenance, education, training and other expenses for specialisation, for a period limited to two years from his arrival in that other State. 3.     A resident of one of the Contracting States present in the other Contracting State under arrangements with the Government of that other State or any agency or instrumentality thereof solely for the purpose of training, study or orientation shall be exempt from tax for a period not exceeding two years from his arrival in that other Contracting State in respect of remuneration received by him on account of such training or study. 4.     For the purposes of paragraph 1, the term "recognised university, college or school" means a university, college or school which has been recognised in this regard by the competent authority of the concerned Contracting State. Article 23 PROFESSORS, TEACHERS AND RESEARCH SCHOLARS 1.     A professor or teacher who is or was a resident of one of the Contracting States immediately before visiting the other Contracting State for the purpose of teaching or engaging in research, or both, at a university, college, school or other approved institution in that other Contracting State shall be exempt from tax in that other State on any remuneration for such teaching or research for a period not exceeding two years from the date of his arrival in that other State. 2.     This article shall not apply to income from research if such research is undertaken primarily for the private benefit of specific person or persons. 3.     For the purposes of this article and article 22, an individual shall be deemed to be a resident of a Contracting State, if he is resident in that Contracting State in the "previous year" or the "calendar year", as the case may be, in which he visits the other Contracting State or in the immediately preceding "previous year" or the "calendar year" 4.     For the purposes of paragraph 1, "approved institution" means an institution which has been approved in this regard by the competent authority of the concerned Contracting State. Article 24 OTHER INCOME 1.     Items of income of a resident of a Contracting State, wherever arising, which are not expressly dealt with in the foregoing articles of this Convention, shall be taxable only in that Contracting State. 2.     The provisions of paragraph 1 shall not apply to income, other than income from immovable property as defined in paragraph 2 and article 6, if the recipient of such income, being a resident of a Contracting State, carries on business in the other Contracting State through a permanent establishment situated therein, or performs in that other State independent personal services from a fixed base situated therein, and the right or property in respect of which the income is paid is effectively connected with such permanent establishment or fixed base. In such cases, the provisions of article 7 or article 16, as the case may be, shall apply. 3.     Notwithstanding the provisions of paragraphs 1 and 2, items of income of a resident of a Contracting State not dealt with in the foregoing articles of this Convention, and arising in the other Contracting State may also be taxed in that other State. Article 25 AVOIDANCE OF DOUBLE TAXATION 1.     The laws in force in either of the Contracting States shall continue to govern the taxation of income in the respective Contracting States except where provisions to the contrary are made in the Convention. 2.     The amount of Romanian tax payable, under the laws of Romania

Download Word Document In English. (Rs.30/-) Kuwait Double Taxation Avoidance Agreement Agreement Between The Government Of The Republic Of India And The Government Of The State Of Kuwait For The Avoidance Of Double Taxation Of Income Derived From International Air Transport. Notification F. No. 501/1/800-FTD dated 31-3-1983. G.S.R. 302(E). -Whereas the annexed Agreement between the Government of the Republic of India and the Government of the State of Kuwait for the avoidance of double taxation of Income derived from international air transport as come into force on the notification by both the Contracting States to each other of completion of the procedures required by their respective laws, as required by Article 5 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) Sur-tax 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 India. ANNEXURE AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE STATE OF KUWAIT FOR THE AVOIDANCE OF DOUBLE TAXATION OF INCOME DERIVED FROM INTERNATIONAL AIR TRANSPORT The Government of India and the Government of Kuwait desiring to conclude an Agreement for the avoidance of double taxation of income derived from international air transport. Have agreed as follows: ARTICLE 1 1.     The existing taxes to which this Agreement shall apply are: a.     In the case of Kuwait:                       i.        the income-tax imposed under the Income-Tax Decree No. 3 of 1955;                      ii.        the additional income-tax imposed under the Law No. 34 of 1970 (hereinafter referred to is " Kuwait tax "). b.    In the case of India:                       i.        the income-tax including any surcharge thereon imposed under the Income-tax Act, 1961 (43 of 1961):                      ii.        the surtax imposed under the companies (Profits) Surtax Act, 1964, (7 of 1964) (hereinafter referred to as " Indian tax "). 2.     This Agreement shall also apply to any identical or substantially similar taxes which are imposed after the date of signature of this Agreement in addition to, or in place of, the taxes referred to in paragraph 1 of this Article. ARTICLE 2 1.     In this Agreement, unless the context otherwise requires: a.     the term " Kuwait " means the territory of Kuwait and includes the territorial sea and airspace above; b.    the term " India " means the territory of India and includes the territorial sea and airspace above it as well as any other maritime zone referred to in the Territorial Waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976 (Act No. 80 of 1976), in which India has certain rights and to the extent that these rights can be exercised therein as if such maritime zone is a part of the territory of India; c.     the term " a Contracting State " and the " other Contracting State " mean Kuwait or India, as the context requires; d.    the term " tax " means " Kuwait tax " or " Indian tax " as the context requires; e.     the term " enterprise of a Contracting State " means an airline which is authorised by the Government of that State by a general or special arrangement between the two Contracting States to operate scheduled or non-scheduled fights between or beyond their territories; f.     the term " international traffic " means any transport by an aircraft operated by an enterprise of a Contracting State, except when the aircraft is operated solely between places in the other Contracting State; g.    the expression " operation of aircraft " means a business of carriage by air of persons, livestock, baggage, cargo or mail and includes the sale of tickets and airway bills for, and the provision of services connected with, such carriage either for the enterprise itself or for any other enterprise engaged in such operations. 2.     In the application of the provisions of this Agreement by one of the Contracting States, any term used but not defined herein shall, unless the context otherwise requires, have the meaning which it has under the laws in force in that State relating to the taxes which are the subjects of this Agreement. ARTICLE 3 1.     Profits derived by an enterprise of a Contracting State from the operation of aircraft in international traffic shall be exempt from tax in the other Contracting State. 2.     The provisions of paragraph 1 shall also apply to the share of profits from the operation of aircraft in international traffic derive by an enterprise of a Contracting State through participation in a pooled service, in a joint air transport operation or in an international operating agency. 3.     For the purpose of paragraph 1, interest on funds directly connected with the operation of aircraft in international traffic shall regarded as income from the operation of aircraft. ARTICLE 4 The laws in force in either of the Contracting States will continue to govern the assessment and taxation of income in the contracting States except where express provisions to the contrary is made in this Agreement. ARTICLE 5 1.     This Agreement shall be approved in accordance with the laws in force in each of the Contracting States. It shall enter into force thirty days after the exchange of letters certifying that the proper procedure was fulfilled in each Contracting State. The exchange of letters shall take place at New Delhi. 2.     The provisions of this Agreement shall have effect in respect of the earnings arising from 1-1-1967. 3.     No action would be taken to reopen assessments in respect of the period prior to 1-1-1967. ARTICLE 6 This Agreement shall continue in effect indefinitely but either Contracting State may, on or before the thirtieth day of June in any calendar year after the year 1986 give notice of termination to the other Contracting State and in such event this Agreement shall cease to be effective: a.     In Kuwait, in respect of any year of tax commencing on or after the 1st day of July of the second calendar year following the year in which the notice is given; b.    In India, in respect of any assessment year commencing on or after the 1st day of April of the second calendar year following the year in which the notice is given. In witness whereof the undersigned, duly authorised thereto have signed the present Agreement. Done in duplicate at Kuwait this twenty-first day of April, one thousand nine hundred and eighty-two in the Hindi, Arabic, and English languages and in the event of any doubt, the English text shall prevail. Sd/ Sd/ For the Government of India For the Government of Kuwait. [F. No. 501/1/80-FTD] R. R. KHOSLA, Jt. Secy. AGREEMENT FOR THE AVOIDANCE OF DOUBLE TAXATION OF INCOME DERIVED FROM INTERNATIONAL AIR TRANSPORT BETWEEN THE REPUBLIC OF INDIA AND THE STATE OF KUWAIT: Corrigendum Notification No. G.S.R. 792(E), dtd. 11.10.1983 In the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. G.S.R. 302(E), dtd. 31.03.1983, published at 124 of the Gazette of India, extraordinary, Part II section 3, sub-section (i), dtd. 31.03.1983,- 1.     at page 3, in Article 2,-                       i.        in paragraph 1, clause (c), line 2, for "he" read "the";                      ii.        in line 4 from the bottom, for '(c) the term "tax"', read '(d)the term "tax"': 2.     at page 4,- a.     in Article 3,-                    i.        in paragraph 2, line 3, for "derive", read "derived";                   ii.        in paragraph 3, line 2, for "airraft", read "aircraft"; b.    in Article 5, paragraph 1, line 5, for "The exchange ", read "The exchange". [F. No. 501/1/80-FTD]

Download Word Document In English. (Rs.30/-) Pakistan Double Taxation Avoidance Agreement Agreement between the Republic of India and the Islamic Republic of Pakistan for the avoidance of double taxation of income derived from International Air Transport Notification G.S.R. No. 792(E), dtd. 29.08.1989. Whereas the annexed Agreement between the Republic of India and the Islamic Republic of Pakistan for the avoidance of double taxation of income derived from international air transport has entered into force on the 1st day of August, 1989, on the notification by both the Contracting States to each other of completion of the procedures required by their respective laws, as required by article 5 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 India. ANNEXURE AGREEMENT BETWEEN THE REPUBLIC OF INDIA AND THE ISLAMIC REPUBLIC OF PAKISTAN FOR THE AVOIDANCE OF DOUBLE TAXATION OF INCOME DERIVED FROM INTERNATIONAL AIR TRANSPORT. The Government of the Republic of India and the Government of the Islamic Republic of Pakistan; Desiring to conclude an agreement for the avoidance of double taxation of income derived from international air transport: Have agreed as follows: Article 1 TAXES COVERED 1.     This Agreement shall apply to taxes on income imposed on behalf of a Contracting State or of its political sub-divisions or local authorities irrespective of the manner in which they are levied. 2.     The existing taxes to which this Agreement shall apply are: a.     In the case of Pakistan:                       i.        the income-tax;                      ii.        the super-tax; and                     iii.        the surcharge; (hereinafter referred to as " Pakistan tax "); b.    In the case of India:                       i.        the income-tax including surcharge thereon; and                      ii.        the surtax; (hereinafter referred to as " Indian tax "). 3.     This Agreement shall also apply to any identical or substantially similar taxes which are imposed after the date of signature of this Agreement in addition to, or in place of, the taxes referred to in paragraph 2 of this article. The competent authority of a Contracting State shall, as soon as possible or at least at the end of each year, notify the other of any substantive changes which are made in its taxation law. Article 2 DEFINITIONS 1.     In this Agreement, unless the context otherwise requires: a.     the terms " a Contracting State " and " the other Contracting State " mean Pakistan or India, as the context requires; b.    the term " tax " means " Pakistan tax ", or " Indian tax ", as the context requires; c.     the term " enterprise of a Contracting State " means:                       i.        an airline designated by the Government of that State in pursuance of the Agreement between the Government of the Islamic Republic of Pakistan and the Government of the Republic of India relating to air services, dated 16th July, 1976 (as amended or revised from time to time); or                      ii.        an airline which is authorised by the Government of that State by a general or special arrangement between the two Contracting States to operate chartered flights between or beyond their territories; d.    the term " international traffic " means any transport by an aircraft operated by an enterprise of a Contracting State, except when the aircraft is operated solely between places in the other Contracting State; e.     the term " competent authority " means:                       i.        in the case of India, the Central Government in the Ministry of Finance (Department of Revenue) or their authorised representative; and                      ii.        in the case of Pakistan, the Central Board of Revenue or their authorised representative. 2.     As regards the application of the Agreement by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning which it has under the law of that State concerning the taxes to which the Agreement applies. Article 3 AVOIDANCE OF DOUBLE TAXATION 1.     Profits derived by an enterprise of a Contracting State from the operation of aircraft in international traffic shall be exempt from tax in the other Contracting State. 2.     The provisions of paragraph 1 shall also apply to the profits from the participation in a pool, a joint business or an international operating agency. 3.     For the purposes of paragraph 1, interest on funds connected with the operation of aircraft in international traffic shall be regarded as profits derived from the operation of such aircraft. Article 4 RESIDUAL PROVISIONS The laws in force in either of the Contracting States will continue to govern the assessment and taxation of income in the Contracting States except where an express provision to the contrary is made in this Agreement. Article 5 ENTRY INTO FORCE Each Contracting State shall notify to the other the completion of the procedure required by its law for the bringing into force of this Agreement. The Agreement shall enter into force on the first day of the second month following the month in which the later of these notifications has been given and shall have effect in respect of income derived on or after the 1st day of July, 1986. Article 6 TERMINATION 1.     This Agreement shall continue in effect indefinitely but either Contracting State may, on or before the thirtieth day of June in any calendar year beginning not earlier than the expiry of a period of five years from the date of its entry into force, give notice of termination to the other Contracting State and in such event this Agreement shall cease to be effective: a.     In Pakistan, in respect of any assessment year on or after the 1st day of July of the second calendar year following the year in which the notice is given; b.    In India, in respect of any assessment year commencing on or after the 1st day of April of the second calendar year following the year in which the notice is given. 2.     In case a comprehensive agreement for the avoidance of double taxation with respect to taxes on income, including inter alia, income derived from International Air Transport is concluded between the Contracting States, then, notwithstanding anything to the contrary in paragraph 1, this Agreement shall cease to have effect from the date on which such comprehensive Agreement enters into force. IN WITNESS WHEREOF,  the undersigned, duly authorised thereto, have signed this Agreement. Done at Islamabad on this thirty-first day of December, one thousand nine hundred and eighty eight in two originals, each in the Hindi and English languages, both texts being equally authentic. In case of divergence between the two texts, the English text shall be the operative one. For the Government of the For the Government of the Islamic Republic of India, Republic of Pakistan (Sd.) S. K. Singh, (Sd.) Niaz A. Naik, Ambassador of India to Pakistan. Ambassador of Pakistan to India. (Sd.) P. K. Appachoo, Joint Secretary to the Government of India. [No. 8438/F. No. 501/9/76-FTD]

Download Word Document In English. (Rs.75/-) Kenya Double Taxation Avoidance Agreement Convention Between India And Kenya For The Avoidance Of Double Taxation And The Prevention Of Fiscal Evasion With Respect To Taxes On Income Notification F. No. G.S.R. 665(E), dtd. 20.08.1985 Whereas the Government of India and the Government of Kenya have concluded a Convention, as set out in the Annexure hereto, for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income; And whereas all the requirements have been completed in India and Kenya as are necessary to give the said Convention the force of law in India and Kenya respectively, as required by paragraph 1 of Article 30 of the said Convention; And whereas the diplomatic notes to this effect have been exchanged between the said two Governments, as required by paragraph 2 of Article 30 of the said Convention. 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 Convention shall he given effect to in the Union of India. CONVENTION BETWEEN INDIA AND KENYA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME The Government of India and the Government of the Republic of Kenya desiring to conclude a Convention to avoid double taxation and to prevent fiscal evasion with respect to taxes on income have agreed upon the following measures. Article 1 PERSONNEL SCOPE This Convention shall apply to persons who are residents of one or both of the Contracting States. Article 2 TAXES COVERED 1.     This Convention shall apply to taxes on income imposed on behalf of each Contracting State, irrespective of the manner in which they are levied. 2.     There shall be regarded as taxes on income all taxes, imposed on total income, or on elements of income including taxes on gains from the alienation of movable or immovable property, and taxes on the total amounts of wages or salaries paid by enterprises. 3.     The existing taxes to which the Convention shall apply are, in particular: a.     In the case of India: The income-tax including any surcharge thereon imposed under the Income-tax Act, 1961 (43 of 1961); and the surtax imposed under the Companies (Profits) Surtax Act, 1964 (7 of 1964) (hereinafter referred to as "Indian tax") b.    In the case of Kenya: The income taxes imposed under the Income-Tax Act (Cap. 70) (hereinafter referred to as "Kenyan Tax"). 4.     This Convention shall apply also to any identical or substantially similar taxes on income which are imposed after the date of signature of this Convention in addition to, or in place of, the existing taxes. The Contracting States shall notify each other of significant changes which have been made in their respective taxation laws. Article 3 GENERAL DEFINITIONS 1.     In this Convention unless the context otherwise requires: a.     The term " Kenya " means the Republic of Kenya, including any area outside the territorial waters or Kenya which, in accordance with international law, has been or may be designated, under the laws or Kenya concerning the Continental Shelf, as an area over which Kenya may exercise sovereign rights with respect to the exploration for and exploitation of natural resources; b.    The term " India " means the territory of India and includes the territorial sea and airspace above it as well as any other maritime zone referred to in the Territorial waters, Continental Shelf, Exclusive Economic Zone and other Maritime Zones Act, 1976 (Act No. 80 of 1976), in which India has certain rights and to the extent that these rights can be exercised therein as if such maritime zone is a part of the territory of India; c.     the terms " a Contracting State " and " the other Contracting State " mean Kenya or India as the con text requires; d.    the term " tax means Kenyan tax or Indian tax " as the context requires, but shall not include any tax which is payable in respect of any default or omission in relation to the taxes to which this Convention applies or which represents a penalty imposed relating to those taxes; e.     the term " person " means an individual, a company and any other body of persons treated is an entity for tax purposes; f.     the term " company " means any body corporate or any entity which is treated as a body corporate for tax purposes; g.    the terms " Kenyan enterprise " and " Indian enterprise " mean respectively an industrial or commercial enterprise or undertaking carried on by a resident of Kenya and an industrial or commercial enterprise or undertaking carried on by a resident of India and the terms " enterprise of a Contracting State " and " enterprise of the other Contracting State " mean a Kenyan enterprise or an Indian enterprise as the context requires; h.     the term " national " means any individual possessing the nationality of Kenya or India as the case may be and all legal persons, partnerships and associations deriving their status as such from the law in force in Kenya or India, as the case may be. i.      the term " competent authority " means:                       i.        in the case of Kenya the Minister of Finance or his authorised representative;                      ii.        In the case of India the Ministry of Finance (Department of Revenue). j.      the term " international traffic " means any voyage of a ship or aircraft operated by an enterprise of a Contracting State, except where the voyage is confined solely to places within the other Contracting State. 2.     In the application of the provisions of this convention by a Contracting State any terms not otherwise defined herein shall unless the context otherwise, requires, have the meaning which it has under the laws in force in that Contracting State relating to the taxes which are the subject of the present Convention. Article 4 FISCAL DOMICILE 1.     For the purpose of this Convention, the term " resident of a Contracting State " means any person who, under the law of that State, is liable to taxation therein by reason of his domicile, residence place of management or any other criterion of a similar nature. 2.     There by reason of the provisions of paragraph 1 an individual is a resident of both Contracting States, then his residential status shall be determined in accordance with the following rules:- a.     he shall be deemed to be a resident of the, Contracting State in which he has a permanent home avail able to him. It he has a permanent home available to him in both Contracting States, he shall be deemed to be a resident of the Contracting State with which his personal and economic relations are closer (hereinafter referred to as his centre of vital interests "); b.    if the Contracting State in which he has his Centre of vital interests cannot be determined, or if he does not have a permanent home available to him in either Contracting State, he shall be deemed to be a resident of the Contracting State in which he has an habitual abode; c.     if he has an habitual abode in both Contracting States or in neither of them, he shall be deemed to be a resident of the Contracting State of which he is a national; d.    if he is a national of both Contracting States or of neither of them, the Competent authorities of the Contracting States shall settle the question by mutual agreement. 3.     Where by reason of the provisions of paragraph 1 a company is a resident of both Contracting States, then this case shall be determined in accordance with the following rules: a.     it shall be deemed to be a resident of the Contracting State of which it is a national; b.    if it is a national of neither of the Contracting States then it shall be deemed to be a resident of a Contracting State in which its place of effective management is situated. 4.     Whereby reason of the provisions of paragraph 1 a person other than an individual or a company is a resident of both Contracting States, it shall then be deemed to be a resident of the Contracting State in which its place of effective, Management is situated. ARTICLE 5 PERMANENT ESTABLISHMENT 1.     For the purposes of this Convention, the term "permanent establishment" means a fixed place of business in which the business of the 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, oil well, quarry or other place of extraction of natural resources; g.    a farm, plantation or other place where agricultural forestry, plantation or related activities are carried on; h.     a building site or construction or assembly project which exists for more than six months; i.      the provision of supervisory activities for more than six months on a building site or construction or assembly project. 3.     The term "permanent establishment" shall not be deemed to include: 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 for collecting information for the enterprise; 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. 4.     A person acting in a Contracting State for or on behalf of an enterprise of the other Contracting State--other than an agent of an independent status to whom the provisions of paragraph 6 apply--shall be deemed to be a permanent establishment in the first mentioned State if: a.     he has, and habitually exercises in that State, an authority to conclude contracts for or on behalf of the enterprise, unless his activities are limited to the purchase of goods or merchandise for the enterprise; or b.    he maintains in that first mentioned State a stock of goods or merchandise belonging to that enterprise from which he regularly fulfils orders on behalf of that enterprise. 5.     An insurance enterprise of a Contracting State shall be deemed to have a permanent establishment in the other Contracting State if it collects premiums in that other State or insures risks therein through an employee or through a representative who is not an agent of independent status within the meaningly of paragraph 6. 6.     An enterprise of a Contracting State 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, general commission agent or any other agent of an independent status, where such persons are acting in the ordinary course of their business. However, where the activities of such an agent are devoted wholly or almost wholly on behalf of that enterprise, he would not be considered an agent of an independent status within the meaning of this paragraph. 7.     The fact that a company which is a resident of a Contracting State 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 constitute either company, a permanent establishment of the other. ARTICLE 6 INCOME FROM IMMOVABLE PROPERTY 1.     Income from immovable property including income from agriculture or forestry may be taxed in the Contracting State in which such property is situated. 2.     For the purposes of this Convention, the term "immovable property" shall be defined in accordance with the law of the Contracting State in which the property in question is situated. The term shall in any case include property accessory to immovable property, livestock and equipment used in agriculture and forestry, right to which the provisions of general law respecting landed property apply, usufruct of immovable property and rights to variable or fixed payments as consideration for the working of, or the right to work, mineral deposits, sources and other natural resources; ships, boats and aircraft shall not be regarded as immovable property. 3.     The provisions of paragraph 1 shall apply to income derived from the direct use, letting, or use in any other form of immovable property and to profits from the alienation of such property. 4.     The provisions of paragraph 1 and 3 shall also apply to the income from immovable, property of an enterprise and to income from immovable property used for the performance of professional services. Article 7 BUSINESS PROFITS 1.     The profits of an enterprise of a Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment situated therein. If the enterprise carries on or has carried on business as aforesaid, the profits of the enterprise may be taxed in the other State but only so much of them as is attributable to: (a) that permanent establishment, (b) seals in the other State of goods or merchandise of the same or similar kind as those sold through that permanent establishment, or (c) other business activities carried on in that other State of the same or similar kind as those effected through that permanent establishment. 2.     Where an enterprise of a Contracting State carries on business in the other Contracting State through a permanent establishment situated therein, there shall in each Contracting State be attributed to the permanent establishment the profits which it might be expected to make if it were a 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. 3.     In the determination of the profits of a permanent establishment there shall be allowed as deduction expenses which are incurred for the purposes of the business of the permanent establishment including executive and general administrative expenses so incurred, whether in the State in which the permanent establishment is situated or elsewhere. 4.     In so far as it has been customary in a Contracting State, according to its law, to determine the profits to be attributed to a permanent establishment on the basis of an apportionment of the total profits of the enterprise to its various parts, nothing in paragraph 2 shall preclude that State from determining the profits to be taxed by such an apportionment as may be customary; the method of apportionment adopted shall, however, be such that the result shall be in accordance with the principles laid down in this Article. 5.     No portion of any profits arising to an enterprise of a contracting State shall be attributed to a permanent establishment situated in the other Contracting State by reason of the mere purchase of goods or merchandise within that other State for enterprise. 6.     For the purposes of the preceding paragraphs, 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 Convention, then the provisions of those Articles shall not be affected by the provisions of this Article. Article 8 AIR TRANSPORT 1.     Profits derived by an enterprise of a Contracting State from the operation of aircraft in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated. 2.     The provisions of paragraph 1 of this Article shall also apply to a share of the profits from the operation of aircraft in international traffic derived by an enterprise of a Contracting State through participation in a pooled service, in a joint air transport operation or in an international operating agency. 3.     For the purposes of paragraph 1, interest on funds directly connected with the operation of aircraft in international traffic shall be regarded as income from the operation of such aircraft, and the provisions of Article 12 shall not apply in relation to such interest. Article 9 SHIPPING 1.     Profits derived by an enterprise of a Contracting State from the operation of ships in international traffic may be taxed in both Contracting States according to the law of each Contracting State: Provided that where such an enterprise derives profits from such operation in the other Contracting State: a.     such profits shall be deemed to be an amount not exceeding five per cent of the full amount received by the enterprise on account of the carriage of passengers or freight embarked in that other State; b.    the tax chargeable in that other State shall be reduced by an amount equal to fifty per cent thereof. ARTICLE 10 ASSOCIATED ENTERPRISES 1.     Where a.     an enterprise of a Contracting State participates directly or indirectly in the management, control or capital of an enterprise of the other Contracting State, or b.    the same persons participate directly or indirectly in the management, control or capital of an enterprise of a Contracting State and all enterprise of the other Contracting State, and in either case conditions are made or imposed between the two enterprises in their, commercial or financial relations which differ from those which would be made between independent enterprises, then any profits which would, but for those conditions, have accrued 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.     Where profits on which an enterprise of a Contracting State has been charged to tax in that State are also included in the profits of an enterprise of the other Contracting State and taxed accordingly, and the profits so included are profits which would have accrued to that enterprise of the other State, if the conditions made between the enterprises had been those which would have been made between independent enterprises, 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 Convention in relation to the nature of the income. Article 11 DIVIDENDS 1.     Dividends paid by a company which is resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State. 2.     However, such dividends may also be taxed in the Contracting State of which the company paying the dividends is a resident, and according to the law of that State, but if the recipient is the beneficial owner of the dividends the tax so charged shall not exceed 15 per cent of the gross amount. 3.     The term " dividends " as used in this Article means income from shares or other rights, not being debt-claims, participating in profits, as well as income from other corporate rights assimilated to income from shares or any other item which is deemed to be a dividend or distribution of a company by the taxation law of the Contracting State of which the company making the distribution is a resident. 4.     The provisions of paragraph 2 shall not apply if the recipient of the dividends, being a resident of a Contracting State, 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 professional services from a fixed base situated therein and the holding by virtue of which the dividends are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 16 as the case may be shall apply. 5.     Where a company which is a resident of a Contracting State derives profits or income from the other Contracting State, that other State may not impose any tax on the dividends paid by the company except insofar as such dividends are paid to a resident of that other State or insofar as the holding in respect of which the dividends are paid is effectively connected with a permanent establishment or a fixed base situated in that other State, nor subject the company's undistributed profits to a tax on the company's undistributed profits, even if the dividends paid or the undistributed profits consist wholly or partly of profits or income arising in such other State. Article 12 INTEREST 1.     Interest arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other state. 2.     However, such interest may be taxed in the Contracting State in which it arises, and according to the law of that State, but the tax so charged in the Contracting State in which the interest arises shall, not exceed 15 per cent of the gross amount of the interest. 3.     Notwithstanding the provisions of paragraph 2, interest arising in a Contracting State and paid to the Government of the other Contracting State or local authority thereof, the Central Bank of that other Contracting State, or any agency wholly owned by that Government or local authority, shall be exempt from tax of the first-mentioned Contracting State. The competent authorities of the Contracting State may determine by mutual agreement any other governmental institution to which this paragraph shall apply. 4.     The term " interest " as used in this Article means income from Government securities, bonds or debentures, whether or not secured by mortgage and whether or not carrying a right to participate in profits, and other debt-claims of every kind as well as all other incomes assimilated to income from money lent by the taxation law of the Contracting State in which the income arises. 5.     The provisions of paragraph 2 shall not apply in the recipient of the interest, being a resident of a Contracting State, 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 professional services from a fixed base situated therein, and the debt-claim 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 16, as the case may be, shall apply. 6.     Interest shall be deemed to arise in a Contracting State when the payer is that State itself, a political sub-division, a local authority or a resident of that State. Where, however, the person paying the interest, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed base in connection with which the indebtedness on which the interest is paid was incurred, and that interest is home by that permanent establishment or fixed base, then such interest shall be deemed to arise in the Contracting State in which the permanent establishment or fixed base is situated. 7.     Where, owing to a special relationship between the payer and the recipient or between both of them and some other person, the amount of the interest paid, having regard to the debt-claim for which it is paid, exceeds the amount which would have been agreed upon by the payer and the recipient 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 payment shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention. Article 13 ROYALTIES 1.     Royalties arising in a Contracting State and paid to a resident of the other Contracting State may he taxed in that other State. 2.     However, such royalties may be taxed in the Contracting State in which they arise, and according to the law of that State, but the tax so charged in the Contracting State in which the royalties arise shall, not exceed 20 per cent of the gross amount of the royalties. 3.     The term " royalties " as used in this Article means payments of any kind received as a consideration for the use of, or the right to use, any copyright of literary, artistic or scientific work (including cinematograph films, and films or tapes for radio or television broadcasting), any patent, trade mark, design or model, plan, secret formula or process, or for the use of, or the right to use, industrial, commercial or scientific equipment, or for information concerning industrial, commercial or scientific experience. 4.     The provisions of paragraph 2 shall not apply if the recipient of the royalties, being a resident of a Contracting State, carries on business in the other Contracting State in which the royalties arise through a permanent establishment situated herein, or performs in that other State professional services from a fixed base situated therein, and the right or property in respect of which the royalties are paid is effectively connected with such permanent establishment or fixed base. In such a case, the provisions of Article 7 or Article 16, as the case may be shall apply. 5.     Royalties, shall be deemed to arise in a Contracting State when the payer is that Contracting State itself, a political sub-division, a local authority or a resident of that State. Where, however, the person paying the royalties, whether he is a resident of a Contracting State or not, has in a Contracting State a permanent establishment or a fixed-base in connection with which the liability to pay the royalties was incurred, and such royalties are borne by such permanent establishment or fixed base, then such royalties shall be deemed to arise in the Contracting State in which the permanent establishment or fixed base is situated. 6.     Where, owing to a special relationship between the payer and the recipient or between both of them and some other person, the amount of royalties paid, having regard to the use, right or information for which they are paid, exceeds the amount which would have been agreed upon by the payer and the recipient 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 payment shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention. Article 14 CAPITAL GAINS 1.     Gains from the alienation of immovable property, as defined in paragraph 2 of Article 6 may be taxed in the Contracting State in which such property situated. 2.     Gains from the alienation of movable property forming part of the business property of a permanent establishment which an enterprise of a Contracting State has in the other Contracting State or of movable property pertaining to a fixed base available to a resident of a Contracting State in the other Contracting State for the purpose of performing professional services, including such gains from the alienation of such a permanent establishment (alone or together with the whole enterprise) or of such a fixed base, may be taxed in that other State. 3.     Notwithstanding the provisions of paragraph 2 gains by an enterprise of a Contracting State from the alienation of ships and aircraft which it operates in international traffic and movable property pertaining to the operation of such ships and aircraft shall be taxable only in that State. 4.     Gains from the alienation of- a.     shares of a company, the property of which consists principally of immovable property situated in a Contracting State, and b.    interest in a partnership or a trust, the property o which consists principally of immovable property situated in a Contracting State, may be taxed in that State. For the purposes of this paragraph the term " immovable property " includes the shares of a company referred to in sub-paragraph (a) or an interest in a partnership or a trust referred to in sub-paragraph (b). 5.     Gains derived by a resident of a Contracting State from the alienation of any property other than those mentioned in paragraphs 1, 2, 3 and 4 shall be taxable only in that State. Article 15 MANAGEMENT AND PROFESSIONAL FEES 1.     Management or professional fees arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. 2.     However such management or professional fees may be taxed in the Contracting State in which they arise, and according to the law of that State, but the tax so charged shall not exceed 17 1/2 per cent of the gross amount of the management or professional fees. 3.     The term " management or professional fees " as used in this Article means payments of any kind to any person, other than to an employee of the person, making the payments in consideration for any services of a managerial, technical, professional or consultancy nature. 4.     The provisions of paragraph 2 shall not apply if the recipient of the management or professional fees, being a resident of a Contracting State, has in the other Contracting State in which the management or professional fees arise a permanent establishment with which the services giving rise to the management or professional fees are effectively connected. In such a case the provisions of Article 7 shall apply. 5.     Management or professional fees shall be deemed to arise in a Contracting State when the payer is that Contracting State itself, a political sub-division, a local authority or a resident of that State. Where, however, the person paying the management or professional fees, whether he is a resident of that State or not, has in a Contracting State a permanent establishment in connection with which the liability to pay the management or professional fees was incurred and such management or professional fees are borne by such permanent establishment, then such management or professional fees shall be deemed to arise in the Contracting State in which the permanent establishment is situated. 6.     Where, owing to a special relationship between the payer and the beneficial owner of the management or professional fees or between both of them and some other person, the amount of the management or professional fees paid, having regard to the service for which they are paid, exceeds the amount which would have been agreed upon by the payer and the beneficial owner 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 payment shall remain taxable according to the law of each Contracting State, due regard being had to the other provisions of this Convention. Article 16 INDEPENDENT PERSONAL SERVICES 1.     Income derived by a resident of a Contracting State in respect of professional services or other independent activities of a similar character shall be taxable only in that State unless: a.     he has a fixed base regularly available to him in the other Contracting State for the purposes of performing his activities, in which case so much of the income may be taxed in that other State as is attributable to that fixed base; or b.    he is present in the other Contracting State for the purpose of performing his activities for a period or periods exceeding in the aggregate 183 days in the calendar year concerned in the case of Kenya or the previous year concerned in the case of India, in which case so much of the income may be taxed in that other State as is attributable to the activities performed in that other State. 2.     The term "professional services" includes independent scientific, literary, artistic, educational or teaching activities, as well as the independent activities of physicians, lawyers, engineers, architects, dentists, and accountants. Article 17 DEPENDENT PERSONAL SERVICES 1.     Subject to the provisions of Articles 18, 19, 20, 21, 22 and 23, salaries, wages and other similar remuneration derived by a resident of a Contracting State in respect of an employment shall be taxable only in that State unless the employment is exercised in the other Contracting State. If the employment is so exercised, such remuneration as is derived therefrom may be taxed in the other State. 2.     Notwithstanding the provisions of paragraph 1, remuneration derived by a resident of a Contracting State in respect of an employment exercised in the other Contracting State shall be taxable only in the first-mentioned State if: a.     the recipient is present in the other State for a period or periods not exceeding in the aggregate 183 days in the fiscal year concerned, and b.    the remuneration is paid by, or on behalf of an employer who is not a resident of the other State, and c.     the remuneration is not borne by a permanent establishment or a fixed base which the employed has in the other State. 3.     Notwithstanding the preceding provisions of this Article, remuneration in respect of an employment exercised aboard a ship or aircraft in international traffic, may be taxed only in Contracting State in which the place of effective management of the enterprise is situated. Article 18 DIRECTORS' FEES Directors' fees and similar payments derived by a resident of a Contracting State in his capacity as a member of the board of directors of a company which is a resident of the other Contracting State may be taxed in that other State. Article 19 ARTISTES AND ATHLETES 1.     Notwithstanding the provisions of Articles 7, 16 and 17, income derived by public entertainers, such as theatre, motion picture, radio or television artistes, and musicians, and by athletes, from their personal activities as such may be taxed in the Contracting State in which those activities are exercised. 2.     Notwithstanding anything contained in this Convention, where the services of public entertainer or an athlete mentioned in paragraph 1 are provided in a Contracting State by an enterprise of the other Contracting State, the profits derived by that enterprise from providing those services may be taxed in the first-mentioned State. 3.     The provisions of paragraphs 1 and 2 shall not apply to services of public entertainers and athletes. If their visit to a Contracting State is supported wholly or substantially from public funds of the other Contracting State. Article 20 GOVERNMENT SERVICE 1.       a.     Remuneration, other than a pension, paid by a Contracting State or a political sub-division or a local authority thereof to any individual in respect of services rendered to that State of sub-division or local authority thereof shall be taxable only in that State. b.    (b)However, such remuneration shall be taxable only in the Contracting State of which the recipient is a resident if the services are rendered in that State and the recipient did not become a resident of that State solely for the purpose of performing the services. 2.     The provisions of paragraph 1 shall not apply to remuneration in respect of services rendered in connection with any trade or business carried on by one of the Contracting States or a political sub-division or a local authority thereof. Article 21 PENSIONS 1.     Any pension [other than a pension of the kind referred to in paragraph (2) of this Article] and any annuity, derived from sources within a Contracting State by an individual who is a resident of the other Contracting State may be taxed in the first-mentioned Contracting State, but if the individual is subject to tax in the other Contracting State in respect of the pension or annuity the tax so charged in the first-mentioned Contracting State shaft not exceed the lower of a.     5 per cent of the pension or annuity; or b.    the amount of tax chargeable on the pension or annuity in the other Contracting State. 2.     Pensions paid by, or out of funds created by, a Contracting State to an individual for services rendered to that Contracting State in the discharge of governmental functions may be taxed only in that Contracting State. 3.     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 money's worth. Article 22 STUDENTS AND APPRENTICES 1.     A student or business apprentice who is or was immediately before visiting a Contracting State a resident of the other Contracting State and who is present in the first-mentioned Contracting State solely for the purpose of his education or training shall be exempt from tax in the first-mentioned Contracting State on payments made to him by persons residing outside that firstmentioned Contracting State for the purposes of his maintenance, education or training. 2.     The benefits of this Article shall extend only for such period of time as may be reasonably or customarily required to complete the education or training undertaken, but in no event shall any individual have the benefits of this Article for more than three consecutive years. Article 23 PROFESSORS AND TEACHERS 1.     A professor or teacher who visits a Contracting State for a period not exceeding one year for the purpose of teaching or conducting research at a University, College, School or other Educational Institution in that Contracting State and who is, or was immediately before such visit, a resident of the other Contracting State shall be exempt from tax in the first-mentioned Contracting State on any remuneration for such teaching or research in respect of which he is subject to tax in the other Contracting State. However, any remuneration for such work received from sources outside the State shall not be deductible in the first-mentioned State. 2.     This Article shall not apply to income from research if such research is undertaken primarily for the private benefit of a specific person or persons. Article 24 INCOME NOT EXPRESSLY MENTIONED 1.     Items of income of a resident of a Contracting State which are not expressly mentioned in the foregoing articles of this Convention in respect of which he is subject to tax in that State shall be taxable only in that State. 2.     However, if such income is derived by a resident of a Contracting State from sources in the other Contracting State, such income may also be taxed in the State in which it arises, and according to the law of that State. Article 25 METHOD OF ELIMINATION OF DOUBLE TAXATION 1.     The laws in force in either of the Contracting States will continue to govern the taxation of income in the respective Contracting States except where provisions to the contrary are made in this Convention. 2.       a.     The amount of Kenyan tax payable, under the laws of Kenya and in accordance with the provision of this Convention, whether directly or by deduction, by a resident of India, in respect of income from sources within Kenya which has been subjected to tax both in India and in Kenya, shall be allowed as a credit against the Indian tax payable in respect of such income, provided that such credit shall not exceed the Indian tax (as computed before allowing any such credit) which is appropriate to the income derived from sources within Kenya; so, however, that where such resident is a company by which surtax is payable in India, the credit aforesaid shall be allowed in the first instance against income-tax payable by the company in India, and as to the balance, if any, against surtax payable by it in India; b.    For the purposes of the credit referred to in sub-paragraph (a) above, the term " Kenyan tax payable " shall be deemed to include any amount which would have been payable as Kenyan tax for any year but for:                               i.        any investment deduction granted under paragraph 24 of the Second Schedule to the Income-tax Act, cap 470;                              ii.        the lower Corporation rate of income-tax provided by paragraph 2(b) of the Third Schedule to the Income-tax Act, cap 470; (iii) any other provisions which may subsequently be enacted granting an exemption or reduction of tax which the competent authorities of the Contracting States agree to be for the purpose of economic development. 3.     a.     The amount of Indian tax payable, under the laws of India and in accordance with the provisions of this Convention, whether directly or by deduction, by a resident of Kenya, in respect of income from sources within India which has been subjected to tax both in India and Kenya, shall be allowed as a credit against Kenyan tax payable in respect of such income provided that such credit shall not exceed the Kenyan tax (as computed before allowing any such credit) which is appropriate to the income derived from sources within India; b.    For the purposes of the credit referred to in sub-paragraph (a) above, the term " Indian tax payable " shall be deemed to include any amount by which Indian tax has been reduced by the special incentive measures set forth in the following Sections of the Income-tax Act, 1961:---                               i.        Sections 10(4), 10(4A), 10(6) (viia), 10(15) (iv), 10A, 32A, 33A, 35B, 35CC, 80HH, 201, 80K, 80L, and                              ii.        any other provisions which may subsequently benacted granting a deduction from taxable income or exemption from or reduction of tax which the competent authorities of the Contracting States agree to be for the purposes of economic development. 4.     Where under this Convention a resident of a Contracting State is exempt from tax in that Contracting State in respect of income derived from the other Contracting State then the firstmentioned Contracting State may, in calculating tax in the remaining income of that person apply the rate of tax which would have been applicable if the income exempted from tax in accordance with this Convention had not been so exempted. Article 26 NON-DISCRIMINATION 1.     The nationals of a Contracting State shall not be subjected in the other Contracting State to any taxation or any requirement connected therewith which is other are more burdensome than the taxation and connected requirements to which nationals of that other State in the same circumstances are or may be subjected. 2.     The taxation on a permanent establishment which an enterprise of a Contracting State has in the other Contracting State shall no be less favourably levied in that other State than the taxation levied on enterprises of that other State carrying on the same activities. 3.     Nothing in this Article shall be construed as obliging a Contracting State to grant to residents of the other Contracting State any personal allowances, reliefs and reductions for taxation purposes on account of civil status or family responsibilities which it grants to its own residents. 4.     Enterprises of a Contracting State, the capital of which is wholly or partly owned or controlled directly or indirectly, by one or more residents of the other Contracting State, shall not be subjected in the first-mentioned State to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of that first-mentioned State are or may be subjected. 5.     In this Article the term "taxation" means taxes which are the subject of this Convention. 6.     Notwithstanding the provisions of the foregoing paragraphs, a company which is a resident of India and which has a permanent establishment in Kenya shall remain subject to an additional rate of tax in accordance with the provisions of Kenyan law, but such additional rate shall not exceed 7.5 per cent. However, such a company will not be subjected to any taxation or any requirement connected therewith which is other or more burdensome than the taxation and connected requirements to which other similar enterprises of that first-mentioned State are or may be subjected. Article 27 MUTUAL AGREEMENT PROCEDURE 1.     Where a resident of a Contracting State considers that the actions of one or both of the Contracting States result or will result for him in taxation not in accordance with this Convention, he may, notwithstanding the remedies provided by the national laws of those States, present his case to the competent authority of the State of which he is a resident. The case must be presented within three years of the date of such action or the latest of such actions as the case may be. 2.     The competent authority shall endeavour, it the objection appears to it to be justified and if it is not itself able to arrive at an appropriate solution, to resolve the case by mutual agreement with the competent authority of the other Contracting State, with a view to the avoidance of taxation not in accordance with this Convention. Any agreement reached shall be implemented notwithstanding any time limits in the national laws oft the Contracting States. 3.     The competent authorities of the Contracting States shall endeavour to resolve by mutual agreement any difficulties or doubts arising as to the interpretation or application of this Convention. They may also consult together for the elimination of double taxation in cases not provided for in this Convention. 4.     The competent authorities of the Contracting States may communicate directly with each other for the purposes of applying the provisions of this Convention. When it seems advisable in order to reach agreement to have an oral exchange of opinions, such exchange may take place through a commission consisting of representatives of the competent authorities of the contracting States. Article 28 EXCHANGE OF INFORMATION 1.     The competent authorities of the contracting States shall exchange such information as is necessary for the carrying out of this Convention or for preventing fraud or fiscal evasion concerning taxes covered by this Convention in so far as the taxation there under is in accordance with this Convention. Any information so exchanged shall be treated as secret and shall not be disclosed to any persons or authorities other than those concerned with the assessment or collection or the taxes which are the subject of this Convention. 2.     In no case shall the provisions of paragraph 1 be construed so as to impose on one of the Contracting States the obligation. a.     to carry out administrative measures at variance with the laws or the administrative practice of that or of the other Contracting Stated; b.    to supply particulars which are not obtainable under the laws or in the normal course of the administration of that or of the other contracting State; c.     to supply information which would disclose any trade, business, industrial, Commercial or professional secret or trade process, or information, the disclosure of which