FOSECO INDIA LIMITED,PUNE V. ACIT CIRCLE 1(1), PUNE

ITA 1117/PUN/2024

AI Insights

Foseco India Limited, a domestic company, appealed against the orders of the Assistant Commissioner of Income Tax and the Commissioner of Income Tax (Appeals), which denied them a refund of excess DDT paid on dividends distributed to its foreign shareholders, Vesuvius Holdings Limited, Foseco Overseas Limited, and Foseco UK Limited, all tax residents of the UK. The company argued that the DDT should be taxed at a reduced rate of 15% as per the India-UK DTAA, rather than the standard rate under Indian law. However, both the lower authorities and the Tribunal upheld that the DDT is a tax on the company, not the shareholders, and thus the DTAA benefits do not apply.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 39513 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2024
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 04-11-2024
• Assessment Year: 2017-2018
• Appeal Filed On: 20-05-2024
• Other Referred Cases: Total Oil India Pvt. Ltd. & Oth Vs. DCIT, Indian Oil Petronas Pvt. Ltd. vs. DCIT, Giesecke & Devrient India Pvt Ltd. vs ACIT, Small Industries Development Bank of India (SIDBI) vs. CBDT, UOI vs. Tata Tea Co. Ltd., Godrej & Boyce Mfg. Co., Ltd. vs. DCIT
• Laws Referred To: Income Tax Act, 1961, Double Taxation Avoidance Agreement between India and UK, Constitution of India
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: RAMNATH P. MURKUNDE
• Assessee Lawyers: ATUL PODDAR
• Keywords: Question of law; Double taxation relief; Residential status
• Section: 195; 250; 154; 90; 274; 14A; 115JB

Judgement Text

" आयकर अपीलीय अधिकरण “ए” न्यायपीठ पुणे में । IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE BEFORE SHRI R.K. PANDA, VICE PRESIDENT AND MS. ASTHA CHANDRA, JUDICIAL MEMBER आयकर अपील सं. / ITA Nos. 1114 to 1120/PUN/2024 धििाारण वर्ा / Assessment Years : 2014-15 to 2020-21 Foseco India Limited, Gat No. 922 & 923, Pune Nagar Road, Sanaswadi, Taluka-Shirur, Pune – 412208 PAN : AAACF1049H Vs. Assistant Commissioner of Income Tax, Circle – 1(1), Pune अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee by : Shri Atul Poddar Department by : Shri Ramnath P. Murkunde Date of hearing : 04-11-2024 Date of Pronouncement : 11-11-2024 आदेश / ORDER PER ASTHA CHANDRA, JM : The seven appeals filed by the assessee are directed against the separate order(s) all dated 28.03.2024 of the Ld. Commissioner of Income Tax (Appeals)-13, Pune [“CIT(A)”] pertaining to Assessment Years (“AYs”) 2014-15 to 2020-21. Since the issue(s) involved are identical, these were heard together and are being disposed of by this common order. 2. We take up the appeal in ITA No. 1114/PUN/2024 for AY 2014-15 as the lead case. 3. The assessee has raised the following grounds of appeal in AY 2014-15 : “1. That on the facts and in the circumstances of the case, the Ld. CIT(A) has been grossly erroneous and unjustified in not providing appropriate relief to the appellant. 2. That on the facts and in the circumstances of the case, the Ld. CIT(A) has been grossly erroneous and unjustified in not admitting that dividend distribution tax is tax in the hands of the shareholders and not in the hands of the company as the onus to pay dividend 2 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 distribution tax has shifted from shareholders to the company to only simplify the administrative burden of collection process. 3. That on the fact and in the circumstances of the case, DDT paid u/s 115- O of the Act on dividends declared and paid to foreign shareholders - Vesuvius Holdings Limited (VHL), Foseco Overseas Limited (FOL) & Foseco UK Limited (FUL), who are tax residents of United Kingdom cannot exceed the rate provided under Article 11 to the Double Taxation Avoidance Agreement between India and UK. 4. That on the facts and in the circumstances of the case, excess DDT paid during the relevant assessment year be refunded, since, as per the provisions of Section 237 of the Act read with Article 265 of the Constitution of India, only legitimate tax could be retained. 5. That the appellant craves leave, to add, to amend, modify, rescind, supplement, or alter any of the Grounds stated here-in above, either before or at the time of hearing/making submission in respect of this appeal.” 4. Briefly stated, the assessee is a domestic company engaged in the business of manufacture, marketing and trading of foundry chemicals and foundry fluxes for the metallurgical industry, including the steel and foundry industry. It is a part of the Ceramics division of the Vesuvius group. For AY 2014-15, the assessee filed its return of income on 30.11.2024 disclosing a total income of Rs.27,17,03,590/- and book profit amounting to Rs.25,66,62,099/- under the provisions of section 115JB of the Income Tax Act, 1961 (the “Act”). During the relevant AY 2014-15, the assessee distributed dividend, amongst others, to its three foreign shareholders i.e. (i) Vesuvius Holdings Limited (“VHL”), Foseco Overseas Limited (“FOL”) and Foseco UK Limited (“FUL”) who all are the tax residents of UK, aggregating to Rs.7,66,30,021/-. On the dividend distributed to VHL, FOL and FUL, the assessee paid Dividend Distribution Tax (“DDT”) amounting to Rs.1,30,23,272/- under the provisions of section 115-O of the Act. The assessee filed an application on 12.05.2021 before the Ld. Assessing Officer (“AO”) requesting for refund of excess DDT paid under the relevant provisions of the Act over and above the rates prescribed under Article 11 of the India-UK Double Taxation Avoidance Agreement (“India-UK DTAA”) on the ground that the DDT is a tax on shareholders and covered under the India-UK DTAA and that the foreign shareholders viz. VHL, FOL and FUL are entitled to take the recourse to the beneficial provisions of India-UK DTAA vis-à-vis the provisions of the Act and relying on certain judicial pronouncements wherein it has been held that the DDT levied shall not exceed the rate specified in the DTAA. Therefore, the assessee claimed that it is eligible for refund of the DDT 3 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 amounting to Rs.15,28,769/- (Rs.1,30,23,272/- - Rs.1,14,94,503/-) paid in excess of the rate prescribed under the India-UK DTAA. After analyzing the submission of the assessee and relevant provisions of the Act and India-UK DTAA, the Ld. AO rejected the assessee’s application for refund on account of excess DDT paid by it vide his order passed u/s 237 of the Act dated 25.11.2022 observing that the DDT is an additional income-tax on companies and it is the company which is subject to tax u/s 115-O of the Act and not the shareholder and hence, the assessee is not entitled to benefit of reduced rate of tax as per the India-UK DTAA. 5. Aggrieved, the assessee carried the matter in appeal before the Ld. CIT(A) challenging the order passed u/s 237 of the Act by the Ld. AO whereby he rejected its application for refund of excess DDT paid. Before the Ld. CIT(A), the assessee submitted that in respect of the dividend declared by it, DDT has been paid @ 16.994% (grossed up) as per the provisions of section 115-O of the Act as against the rate of 15%/10% provided in India-UK DTAA and therefore the reduced rate of 15% as per the India-UK DTAA should be applied for the payment of DDT and the excess tax paid should be refunded to the assessee. However, the Ld. CIT(A) did not accept the above contention of the assessee and dismissed the appeal by relying on the decision of the Special Bench of the Tribunal in the case of Total Oil India Pvt. Ltd. & Oth Vs. DCIT vide ITA No. 6997/Mum/2019 dated 20.04.2023 decided in favour of the Revenue. The relevant para of the Ld. CIT(A)’s order reads as under : “2.3 I have carefully considered the facts of the case and submission filed by the appellant. The issue is regarding claim of refund of excess dividend distribution tax paid by the appellant u/s 115-0 on repatriation of dividend income to its holding company viz. non-resident shareholder companies, Vesuvius Holding Limited (VHL) holding 8.52% shares, Foseco (UK) Limited (FULL) holding 8.46% shares and Foseco Overseas Limited (FOL) holding 58% shares. Briefly, the appellant company distributed dividend of Rs.7,66,30,021 to VHL, FUL, and FOL during FY 2013-14. The appellant company deducted DDT on this as per section 115-0 of the Act amounting to Rs.1,30,23,272 (@16.994%). The appellant has claimed that instead of Tax deducted 16.994% (grossed up), the DDT should have been restricted @10% as per of Article 11 of the India-UK Double Taxation Avoidance Agreement (the DTAA' or the tax treaty) read with section 90(2) of the Act. It is seen that section 90 is under Chapter IX of the Income Tax Act which is on double taxation relief. This primarily deals with non-resident assesses and section 90(2) states the principle for granting relief of tax for non-resident assesses for avoidance of double taxation. It is not furnished how the dividends have been taxed in both India and UK for the non- resident parent entity and further in Indo-UK DTAA, the contracting states have not extended the treaty protections to profits distributed by Indian company by deeming the DDT paid by the Indian company as tax paid by shareholder and restricting the DDT rate. 4 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 2.4 Further, it is also seen that the Hon'ble Special Bench of the Mumbai ITAT passed order in case of Total Oil India Pvt Ltd & Oth Vs DCIT, Mumbai & Oth (ITA No 6997/Mum/2019 dtd. 20.04.2023) wherein the similar issue was decided. The hon'ble tribunal has held that DDT is an additional tax levied on the company and not the shareholder and accordingly, the benefit of the lower tax rate as per the relevant DTAA for taxation of dividend will not be available in case of non-resident shareholders, except where specifically agreed upon. The relevant para of the ITAT order is reproduce as under. 81. If domestic company has to enter the domain of DTAA, the countries should have agreed specifically in the DTAA to that effect. In the Treaty between India and Hungary, the Contracting States have extended the Treaty protection to the dividend distribution tax. It has been specifically provided in the protocol to the Indo Hungarian Tax Treaty that, when the company paying the dividends is a resident of India the tax on distributed profits shall be deemed to be taxed in the hands of the shareholders and it shall not exceed 10 per cent of the gross amount of dividend. While making Reference in the case of Total Oil (supra), the Id. Division Bench has made the following observations on this aspect: “(f) Wherever the Contracting States to a tax treaty intended to extend the treaty protection to the dividend distribution tax, it has been so specifically provided in the tax treaty itself. For example, in India Hungry Double Taxation Avoidance Agreement ((2005) 274 ITR (Stat) 74; Indo Hungarian tax treaty, in short], it is specifically provided, In the protocol to the Indo Hungarian tax treaty it is specifically stated that \"When the company paying the dividends is a resident of India the tax on distributed profits shall be deemed to be taxed in the hands of the shareholders and it shall not exceed 10 per cent of the gross amount of dividend\". That is a provision in the protocol, which is essentially an integral part of the treaty, and the protocol to a treaty is as binding as the provisions in the main treaty itself. In the absence of such a provision in other tax treaties, it cannot be inferred as such because a protocol does not explain, but rather lays down, a treaty provision. No matter how desirable be such provisions in the other tax treaties, these provisions cannot be inferred on the basis of a rather aggressively creative process of interpretation of tax treaties. The tax treaties are agreements between the treaty partner jurisdictions, and agreements are to be interpreted as they exist and not on the basis of what ideally these agreements should have been. (g) A tax treaty protects taxation of income in the hands of residents of the treaty partner jurisdictions in the other treaty partner jurisdiction. Therefore, in order to seek treaty protection of an income in India under the Indo French tax treaty, the person seeking such treaty protection has to be a resident of France. The expression 'resident' is defined, under article 4(1) of the Indo French tax treaty, as \"any person who, under the laws of that Contracting State, is liable to tax therein by reason of his domicile, residence, place of management or any other criterion of a similar nature\". Obviously, the company incorporated in India, i.e. the assessee before us, cannot seek treaty protection in India- except for the purpose of, in deserving cases, where the cases are covered by the nationality non-discrimination under article 26(1), deductibility non-discrimination under article 26(4), and ownership non- discrimination under article 24(5) as, for example, article 26(5) specifically extends the scope of tax treaty protection to the enterprises of one of the Contracting States, the capital of which is wholly or partly owned or controlled, directly or indirectly, by one or more residents of the other Contracting State\" The same is the position with respect of the other non-discrimination provisions. No such extension of the scope of treaty protection is 5 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 envisaged, or demonstrated, in the present case. When the taxes are paid by the resident of India, in respect of its own liability in India, such taxation in India, in our considered view, cannot be protected or influenced by a tax treaty provision, unless a specific provision exists in the related tax treaty enabling extension of the treaty protection. (h) Taxation is a sovereign power of the State- collection and imposition of taxes are sovereign functions. Double Taxation Avoidance Agreement is in the nature of self-imposed limitations of a State's inherent right to tax, and these DTAAs divide tax sources, taxable objects amongst themselves. Inherent in the self-imposed restrictions imposed by the DTAA is the fact that outside of the limitations imposed by the DTAA, the State is free to levy taxes as per its own policy choices. The dividend distribution tax, not being a tax paid by or on behalf of a resident of treaty partner jurisdiction, cannot thus be curtailed by a tax treaty provision 82. We are of the view that the above exposition of law is correct and we agree with the same. Therefore, the DTAA does not get triggered at all company pays DOT u/s 1160 of the A Act when a domestic company pays DDT u/s. 115O of the Act. Conclusion : 83. For the reasons give above, we hold that where dividend is declared, distributed or paid by a domestic company to a non-resident shareholder(s), which attracts Additional Income Tax (Tax on Distributed Profits) referred to in Sec. 115-0 of the Act, such additional income tax payable by the domestic company shall be at the rate mentioned in Section 115 O of the Act and not at the rate of tax applicable to the non- resident shareholder(s) as specified in the relevant DTAA with reference to such dividend income. Nevertheless, we are conscious of the sovereign's prerogative to extend the treaty protection to domestic companies paying dividend distribution tax through the mechanism of DTAAs. Thus, wherever the Contracting States to a tax treaty intend to extend the treaty protection to the domestic company paying dividend distribution tax, only then, the domestic company can claim benefit of the DTAA, if any. Thus, the question before the Special Bench is answered, accordingly. UNQUOTE\" On the basis of the reasoning given above, it is concluded that where dividend is declared, distributed or paid by a domestic company to a non- resident shareholder, which attracts DDT referred to in Section 115-0 of the Act, such DDT payable by the domestic company shall be at the rate mentioned in Section 115-0 of the Act and not at the rate of tax applicable to the non-resident shareholder as specified in the relevant DTAA with reference to such dividend income. Wherever the Contracting States to a tax treaty intend to extend the treaty protection to the domestic company paying DDT, only then, the domestic company can claim benefit of the DTAA, if any.” 6. Dissatisfied, the assessee is in appeal before the Tribunal and all the grounds raised by the assessee relate thereto. 7. Both the Ld. Representatives of the parties fairly conceded that the impugned issue stands decided against the assessee by the decision of the Special Bench of the Tribunal in the case of Total Oil India Pvt. Ltd. & Oth (supra), which has been followed by the Ld. CIT(A). The Ld. AR, however 6 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 filed the written submission in support of its claim and made a request to consider the same. The written submission filed by the Ld. AR reads as under : Gr. No. Particulars Key submissions 1 to 5 Refund of excess DDT paid u/s 115-0 amounting to Rs.15,28,769/- Brief Facts During the previous year relevant to the assessment year under consideration, the appellant had distributed dividend, among other shareholders, to its foreign shareholders, Vesuvius Holdings Limited ('VHL'), Foseco 2. Overseas Limited ('FOL) & Foseco UK Limited (FUL') aggregating to Rs.7,66,30,021/-. VHL, FOL & FUL are tax residents of United Kingdom ('UK\"). On the dividend distributed to VHL, FOL & FUL, the appellant had paid Dividend Distribution Tax ('DDT') amounting to Rs.1,30,23,272/- @ 16.994%). In terms of Article 11 of India-UK Double Taxation Avoidance Agreement (DTAA'), dividend shall be taxable @ 15% in the hands of beneficial owner of the dividend i.e. shareholders. Consequently, dividend of Rs.7,66,30,021/- paid to VHL, FOL & FUL of UK shall be taxable at the beneficial rate of 15% as prescribed under DTAA, i.e., Rs. 1,14,94,503/-. Hence, the appellant is eligible for refund of the DDT paid in excess of the rates prescribed under applicable DTAA amounting to Rs.15,28,769/- (Rs.1,30,23,272/- less Rs.1,14,94,503/-). On the basis of the above understanding, the appellant has filed a petition u/s 237 of the Act dated 13- 04-2021 (filed on 12-05- 2021) for claiming refund of 1. In terms of Memorandum explaining the provisions of Finance Bill, 1997, 2002, 2003, 2016 & 2020, in relation to dividend distribution it is apparent that dividend is taxable in the hands of the recipient. For administrative purpose, provision of DDT was introduced in the statute books to simplify the collection process by making the company liable to pay tax on such dividend distributed. The relevant portion of the Memorandum are enclosed and collectively marked as Annexure – 1. In essence, tax on shareholders was collected through companies. 2. There are several decisions wherein it has been held that DDT being a tax on shareholder and not on the company, the tax rates specified in DTAA in respect of dividend must prevail over DDT- M/s. Indian Oil Petronas Pvt. Ltd. vs. DCIT 120211 127 taxmann.com 389 (Kolkata - Trib.) Giesecke & Devrient India Pvt Ltd. vs ACIT [20201 120 taxmann.com 338 (Delhi -Trib.) 3. However, the Ld. CIT(A) had dismissed appeal by placing reliance on judgment of the Special Bench (SB) of Hon'ble Mumbai ITAT in case of DCIT Vs Total Oil India Pvt. Ltd. ITA No 6997/MUM/2019 dated 20- 04-2023. The Ld. CIT(A) stated that the Protocol to India- Hungary DTAA have extended the Treaty protection to DDT wherein it has been specifically provided that when the Co. paying dividend is a resident of India, the tax on distributed profits shall be deemed to be taxed in the hands of shareholders and it shall not exceed 10% of gross amount of dividend. Referring to the same, it was held that wherever the Contracting States to a tax treaty intend to extend the treaty protection to the domestic company paying DDT, only then, the domestic company can claim benefit of the DTAA, if any. However, the aforesaid judgment have not considered the following aspects: Though SB has held that Sec. 115-0 is a complete code independent from the concept \"total income\" as envisaged under the statute, however, it is worthwhile to mention 7 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 excess DOT paid over and above the rates specified in India-UK DTAA for dividend distributed to non-resident shareholders Post filing of the above petition, letter u/s 154 of the Act dated 19 07-2021 was issued by Ld. ACIT wherein it has been duly stated that the option to modify the DOT payment is not available in the system with the Ld. ACIT and as soon as the functionality is updated in the system, the same will be rectified. Against the said letter, the appellant filed reply dated 17- 08-2021 wherein the appellant humbly prayed that technical difficulty shall hold no ground to restrain the refund entitled to the appellant and requested the Ld. ACTT to pass order u/s 237 of the Act. However, subsequently, the La ACIT rejected the application filed u/s 237 for refund on account of excess DDT and passed the order u/s 237 of the Act dated 25- 11- 2022 stating that DDT is an \"Additional Income-tax companies and it is the company which is subject to tax u/s 115-0 and not the shareholder and, hence, the appellant is not entitled to benefit of reduced rate as per the DTAA. Against the aforesaid order u/s 237, the appellant filed an appeal before Ld. CIT(A) and Ld. CIT(A) upheld the order of Ld. AO vide order passed u/s 250 dated 28- 03- 2024 by relying on the judgment of Hon'ble Special Bench in case of DCIT Vs Total Oil India Pvt. Ltd. [ITA No 6997/MUM/2019 dated 20-04-2023. that in terms of entry 82 of List I of Schedule VII of the Constitution of India and as per the conjoint reading of the Preamble, Sec. 4 & 5 of the Act, a tax under the Act can only be levied on the income of the person assessable under the statute and if such distributed profits are not part of \"total income\", then such levy is not in accordance with law; In terms of the memorandum to the Finance Bill, 2020 the legislature in its wisdom has restricted the operation of Sec. 115-0 of the Act till March 31, 2020, whilst categorically noting that dividend was the income of the shareholder and Sec. 115-0 of the Act was introduced for casement of tax collection. This, in itself, fortifies the view that tax levied u/s 115-0 was nothing but a tax on dividend income of the shareholder. Further, the law as it stands today also provides that dividend income of the non-resident shareholder suffers withholding tax u's 195 of the Act subject to benefits available under the DTAA; -SB completely overlooked the cardinal principle of law that unless a DTAA is amended jointly by the sovereigns, the benefits granted thereunder cannot be altered unilaterally by way of an amendment in the domestic law. In sun and substance, the Special Bench ought to have considered that a unilateral amendment being a shift in the incidence of tax on dividend income of the shareholder in the hands of the company u/s 115-0 of the Act cannot restrict the benefits as provided under the DTAA: -SB completely miscues on expounding the real nature of the income taxed w/s 115-0 of the Act. A tax on distributed profits of the company u/s 115-0 is an additional income tax levied on any amount declared, distributed or paid by way of dividends by the domestic company to its shareholders. By no stretch of imagination, any sum being distributable profits declared by way of dividends can be characterized as \"income\" of the domestic company itself and not dividend income in the hands of the shareholders; Further, SB relied on the judgement of Hon'ble Jurisdictional High Court in the Case of Small Industries Development Bank of India (SIDBI) vs. CBDT 1133 taxmann.com 1581 dated 02-12-2021 wherein the Hon'ble HC held the charge u/s 115-0(1) of the Act is not on income by way of dividend in the shareholder's hands. Therefore, the additional income-tax payable 8 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 on profits of a domestic company u/s 115-0 of the said Act is not a tax on dividend. Further, the amount distributed or paid by way of dividend falls in the category of income, profit or gains derived. Accordingly, for an entity which falls u/s 50 of the SIDBI Act and its entire income is exempt from tax under Income Tax Act shall not be required to pay DDT on dividend distributed to shareholders. However, the said view is against the judgement of Hon'ble Apex court in the case of UOI vs. Tata Tea Co. Ltd. |2017 85 taxmann.com 346 (SC) dated 20-09-2017 (Division Bench Judgement) wherein the Apex Court while dealing with the issue with respect to constitutional validity of DDT on composite income of tea company held that the provisions of Sec. 115-0 of the Act shall be applicable on dividend distributed from agricultural income also. The Hon'ble Apex Court held that when dividend is declared to be distributed and paid to company's shareholder, it is not impressed with the character of source of its income. In the light of above, the appellant humbly submits that reliance of SB on judgement of Bombay HC is misplaced, The Hon'ble SB held that, the Godrej & Boyce Mfg. Co., Ltd. vs. DCIT 120101 194 Taxman 203 (Bombay HC) decision lays down the principle that DDT is not a tax paid on behalf of the shareholder. The said principle has also been upheld by Godrej & Boyce Manufacturing Company Ltd. vs. DCIT (2017) 81 taxmann.com 111 (SC). However, the said principle does not dilute the principle that it is tax on 'dividend income, with merely the incidence of tax being on the resident company declaring such dividend. Further, the Godrej & Boyce HC decision and G&B SC decision have not laid down any principle contrary to those laid down by the Hon'ble SC in the case of Union of India Vs Tata Tea Co Lad (supra) and both the decisions operate in different fields since those cases pertained to the issue concerning disallowance of expenditure u/s 14A of the Act. Further, the Tata Tea decision of Hon'ble SC specifically discusses regarding the characterization and validity of DDT u/s 115-0 of the Act & accordingly, the said ruling is binding in the present context; SB stated that if domestic company has to enter the domain of DTAA, the countries should have agreed specifically in the DTAA to that effect. In the Treaty between India and Hungary, the Contracting States have extended the Treaty protection to the dividend distribution tax. It has been specifically provided in the protocol to the 9 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 Indo Hungarian Tax Treaty that, when the company paying the dividends is a resident of India the tax on distributed profits shall be deemed to be taxed in the hands of the shareholders and it shall not exceed 10 per cent of the gross amount of dividend. However, the Hon'ble ITAT did not appreciate the fact that there is no such requirement and dividend has always been considered as tax in the hands of beneficial owner. 4. In respect to the above discussions and judicial pronouncements, the appellant most humbly submits that it is eligible for refund of the DDT paid in excess of the rates prescribed under applicable DTAA amounting to Rs.15,28,769/- (Rs.1,30,23,272/- less Rs. 1,14,94,503/). 5. Further, Hon'ble Delhi HC has admitted appeal in the case of Intertek India Private Limited vs. DCIT [ITA No. 405/2024] wherein following question of law has been considered - (a) Whether the DDT prescribed u/s 115-O of the Act is in substance and effect a tax on dividend income of non-resident shareholders and where recipient shareholders are residents of United Kingdom the more beneficial rate of tax of 10% under Article 11 of DTAA between India- UK is applicable? (b) Whether decision of the SB in the case of Total Oil India Pvt. Ltd. (supra) lays down the correct law? 6. The appellant prays to keep the aforesaid proceedings on hold till the disposal of appeal by Hon'ble Delhi HC since the same involves substantial question of law. 8. We have heard the Ld. Representative of the parties, considered their submission and perused the material available on record. The facts are not in dispute. We observe that the impugned issue is squarely covered in favour of the Revenue by the decision of the Special Bench of Mumbai Tribunal in the case of Total Oil India Pvt. Ltd. & Oth (supra). The Ld. CIT(A) while deciding the impugned issue against the assessee followed the decision of the Special Bench of the Tribunal (supra). There is no contrary material that has been brought to our notice. We, therefore, do not find any infirmity in the order of Ld. CIT(A) which is hereby upheld. Respectfully following the decision (supra) of the Special Bench of Mumbai 10 ITA Nos. 1114 to 1120/PUN/2024, AYs 2014-15 to 2020-21 Tribunal in Total Oil India (P.) Ltd’s case, the grounds raised by the assessee are dismissed. 9. In the result, the appeal of the assessee for AY 2014-15 is dismissed. ITA Nos. 1115 to 1120/PUN/2024, AYs 2015-16 to 2020-21 10. Both the sides are unanimous in stating that the facts and the grounds of appeals in ITA Nos. 1115 to 1120/PUN/2024 are identical to the grounds raised in ITA No. 1114/PUN/2024 except the variance in amounts. Thus, in view of the fact that the issue raised in the appeals are identical and are arising from same set of facts, the findings given by us while adjudicating the appeal in ITA No. 1114/PUN/2024 would mutatis mutandis apply to the appeals in ITA Nos. 1115 to 1120/PUN/2024 as well. Accordingly, these appeals of the assessee are also dismissed in the same terms. 11. To sum up, all the seven appeals of the assessee in ITA Nos. 1114 to 1120/PUN/2024 for AYs 2014-15 to 2020-21 are dismissed. Order pronounced in the open court on 11th November, 2024. Sd/- Sd/- (R.K. Panda) (Astha Chandra) VICE PRESIDENT JUDICIAL MEMBER पुणे / Pune; दिन ांक / Dated : 11th November, 2024. रदि आदेश की प्रधिधलधप अग्रेधर्ि / Copy of the Order forwarded to : 1. अपील र्थी / The Appellant. 2. प्रत्यर्थी / The Respondent. 3. The Pr. CIT concerned. 4. दिभ गीय प्रदिदनदि, आयकर अपीलीय अदिकरण, “ए” बेंच, पुणे / DR, ITAT, “A” Bench, Pune. 5. ग र्ड फ़ इल / Guard File. //सत्य दपि प्रदि// True Copy// आिेश नुस र / BY ORDER, िररष्ठ दनजी सदचि / Sr. Private Secretary आयकर अपीलीय अदिकरण ,पुणे / ITAT, Pune "