Section 2(23) of income tax, act 1961
This query is : Resolved
06 March 2014
Whether a partnership firm [registered in UK] is a ‘firm’ under Section 2(23) of the 1961 Act or is it an association of persons ?
06 March 2014
in my opinion only if the foreign partnership firm in its country of residence is not considered as a pass-through entity, it should considered as a partnership firm for indian tax purposes.
where partnership is considered as a pass-through entity, it should be taxed as an AOP
where partnership is considered as a pass-through entity, it should be taxed as an AOP
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06 March 2014
It means that if Uk is treating that firm as a fiscally transparent entity, then In India, that partnership firm will be taxed as AOP......Can you give some Cases or any authority on such assertion.
06 March 2014
i was looking for that only. I believe there was a case law on a US based law firm...i believe it was linklaters LLP (132 TTJ 201).
however, there was an amendment to India-UK DTAA to enable UK based partnership firms to claim DTAA benefits in hands of the partner.
you may refer
http://www.ey.com/Publication/vwLUAssets/Tax_Alert_2012_Protocol_amending_the_1993_India_UK_DTAA.pdf/$FILE/Tax_Alert_2012_Protocol_amending_the_1993_India_UK_DTAA.pdf
however, there was an amendment to India-UK DTAA to enable UK based partnership firms to claim DTAA benefits in hands of the partner.
you may refer
http://www.ey.com/Publication/vwLUAssets/Tax_Alert_2012_Protocol_amending_the_1993_India_UK_DTAA.pdf/$FILE/Tax_Alert_2012_Protocol_amending_the_1993_India_UK_DTAA.pdf
06 March 2014
I read that Case and it was treated as a Partnership firm (though not specifically written in the case anywhere)..BTW this protocol is in effective now or not ? if yes, then whether this will have a retrospective effect ?
06 March 2014
India has notified it yet...
06 March 2014
So, it is in effect ?
06 March 2014
as on today situation is as it what it is. you will have to go on case to case basis to argue your case.
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