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Report No. 12

93. Countries with which no agreement exists.-

If any person who is resident in India in any previous year proves that, in respect of his income which accrues or arises during that previous year without India (and which is not deemed to accrue or arise in India), he has paid in any country, with which there is no agreement under section 92 [49A} for the relief or avoidance of double taxation, income-tax, by deduction or otherwise under the law in force in that country, he shall be entitled to the deduction from the Indian income-tax payable by him of a sum calculated on such doubly taxed income at the Indian rate of tax or the rate of tax of the said country, whichever is the lower, or at the Indian rate of tax if both the rates are equal.

[Section 49D(1)]

(2) If any person who is resident in India in any previous year proves that in respect of his income which accrues or arises to him during that previous year in Pakistan he has paid in that country, by deduction or otherwise, tax payable to the Government under any law for the time being in force ift that country relating to taxation of agricultural income, he shall be entitled to a deduction from the Indian income-tax payable by him-

(a) of the amount of the tax paid in Pakistan under any law aforesaid on such income which is liable to tax under this Act also; or

(b) of a sum calculated on that income at the Indian rate of tax; whichever is less......

[Section 49D(3)]

Explanation.-In this section,-

(i) the expression "Indian income-tax" means income-tax and super-tax charged in accordance with the provisions of this Act;

(ii) the expression "Indian rate of tax" mean's the rate determined by dividing the amount of Indian income-tax, after deduction of any relief due under the provisions of this Act but before deduction of any relief due under this section, by the total income;

(iii) the expression "rate of tax of the said country" means income-tax and super-tax actually paid in the said country in accordance with the corresponding laws of the said country after deduction of all relief due but before deduction of any relief due in the said country in respect of double taxation, divided by the whole amount of the income assessed in the said country;

(iv) the expression "income-tax" in relation to any country", includes any excess profits tax or business profits tax charged on the profits by the Government of any part of that country or a local authority in that country.

[Section 49D, Expin.]



Income-Tax Act, 1922 Back




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