Section 206AA Does Not Have Overriding Effect Over Other Provisions Of The Act: ITAT Hyderabad

In the case of Nagarjuna Fertilizers and Chemicals Limited vs. ACIT, ITAT Hyderabad (Special Bench) has held that:

In view of the above discussion, we are of the view that the provisions of section 206AA of the Act will not have a overriding effect for all other provisions of the Act and the provisions of the Treaty to the extent they are beneficial to the assessee will override sect ion 206AA by virtue of section 90(2). In our opinion, the assessee therefore cannot be held liable to deduct tax at higher of the rates prescribed in section 206AA in case of payments made to non-resident persons having taxable income in India in spite of their failure to furnish the Permanent Account Numbers.

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