SECTION 90 OF THE INCOME-TAX ACT, 1961 – DOUBLE TAXATION AGREEMENT – AGREEMENT FOR AVOIDANCE OF DOUBLE TAXATION AND PREVENTION OF FISCAL EVASION WITH FOREIGN COUNTRIES – JAPAN

NOTIFICATION NO. S.O. 1189(E) [NO. 19/2012 (F. NO. 506/69/81-FTD.1)], DATED 24-5-2012

Whereas the Convention between the Government of the Republic of India and the Government of Japan for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with Respect to Taxes on income has come into force on the 29th day of December, 1989 after the exchange of Instruments of Ratification as required by paragraph 1 of Article 28 of the said Convention;

And whereas, the said Convention was notified by the Central Government under section 90 of the Income-tax Act, 1961 (43 of 1961) in the Gazetee of India vide No. G.S.R. 101(E) dated 1st March, 1990;

And whereas, clause (a) of paragraph 4 of Article 11 of the said Convention provides the details regarding ‘Central Bank’ and ‘financial institution wholly owned by the Government’ in the case of Japan which will not be subject to tax under paragraph 3 of the said Article, in respect of interest arising to it in the other Contracting State;

And whereas, sub-clause (ii) of clause (a) of paragraph 4 of article 11 refers to ‘international business unit of Japan Finance Corporation’ as one of the financial institutions wholly owned by the Government;

And whereas, both the Government of India and the Government of Japan have now agreed to omit ‘International business unit of Japan Finance Corporation’ from sub-clause(ii) of clause (a) of paragraph 4 of Article 11 and substitute therein “Japan Bank for International Cooperation”;

Now, therefore, in exercise of the powers conferred by section 90 of the Income-tax Act, 1961, the Central Government hereby directs that the following amendments shall be made In the said notification as follows:-

In the said notification, in the Annexure, in Article 11 of the Convention, in paragraph 4, in clause (a), for sub-clause (ii), the following sub-clause shall be substituted, namely:-

“(ii) Japan Bank for international Co-operation;”.

2. This notification shall be deemed to have taken effect from the 1st April 2012.