notification no. 96/2016/f. no. 500/121/1996 ftd ii / s.o. 3265 e

MINISTRY OF FINANCE (Department of Revenue) NOTIFICATION (INCOME TAX) New Delhi, the 24th October, 2016 S.O.3265(E).—Whereas, an Agreement was entered into between the Government of the Republic of India and the Government of the Republic of Korea for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income that was signed at Seoul, Korea on the 18th day of May, 2015 as set out in the Annexure to this notification (hereinafter referred to as the Agreement); And whereas, the date of entry into force of the said Agreement is the 12th day of September, 2016, being the date of the later of the notifications of the completion of the procedures as required by the respective laws for entry into force of the said Agreement, in accordance with paragraph 2 of Article 30 of the said Agreement; And whereas, clause (a) of paragraph 3 of Article 30 of the said Agreement provides that the provisions of the Agreement shall have effect in India in respect of income derived in any fiscal year beginning on or after the first day of April next following the calendar year in which the Agreement enters into force; Now, therefore, in exercise of the powers conferred by sub-section (1) of section 90 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies that all the provisions of said Agreement between the Government of the Republic of India and the Government of the Republic of Korea for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income, as set out in the Annexure here to, shall be given effect to in the Union of India. [Notification No. 96/2016/F. No. 500/121/1996-FTD-II] ] RAJAT BANSAL, Jt. Secy. ANNEXURE AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE REPUBLIC OF KOREA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME The Government of the Republic of India and the Government of the Republic of Korea, desiring to conclude an Agreement for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and with a view to promoting economic cooperation between the two countries, have agreed as follows: ¹Hkkx IIµ[k.M 3(ii)º Hkkjr dk jkti=k % vlk/kj.k 19 Article 1 PERSONS COVERED This Agreement shall apply to persons who are residents of one or both of the Contracting States. Article 2 TAXES COVERED 1. This Agreement shall apply to taxes on income imposed on behalf of a Contracting State or of its political subdivisions or local authorities, irrespective of the manner in which they are levied. 2. There shall be regarded as taxes on income all taxes imposed on total income, or on elements of income, including taxes on gains from the alienation of movable or immovable property and taxes on the total amounts of wages or salaries paid by enterprises. 3. The existing taxes to which the Agreement shall apply are in particular: a) in the case of India : the income tax, including any surcharge thereon (hereinafter referred to as "Indian tax"); b) in the case of Korea: (i) the income tax; (ii) the corporation tax; and (iii) the special tax for rural development on income (hereinafter referred to as “Korean tax”). 4. The Agreement shall apply also to any identical or substantially similar taxes which are imposed after the date of signature of the Agreement in addition to, or in place of, the existing taxes. The competent authorities of the Contracting States shall notify each other of any significant changes that have been made in their respective taxation laws. Article 3 GENERAL DEFINITIONS 1. For the purposes of this Agreement, unless the context otherwise requires: a) the term “India” means the territory of India and includes the territorial sea and airspace above it, as well as any other maritime zone in which India has sovereign rights, other rights and jurisdiction, according to the Indian law and in accordance with international law, including the United Nations Convention on the Law of the Sea of December 10, 1982; b) the term "Korea" means the Republic of Korea, and when used in a geographical sense, the territory of the Republic of Korea including its territorial sea, and any area adjacent to the territorial sea of the Republic of Korea which, in accordance with international law, has been or may hereafter be designated under the laws of the Republic of Korea as an area within which the sovereign rights or jurisdiction of the Republic of Korea with respect to the sea-bed and sub-soil, and their natural resources may be exercised; c) the terms "a Contracting State" and "the other Contracting State" mean the Republic of India or the Republic of Korea as the context requires; d) the term "person" includes an individual, a company, a body of persons and any other entity which is treated as a taxable unit under the taxation laws in force in the respective Contracting States; e) the term "company" means any body corporate or any entity that is treated as a body corporate for tax purposes; f) the term “enterprise” applies to the carrying on of any business; 20 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(ii)] g) the terms "enterprise of a Contracting State" and "enterprise of the other Contracting State" mean respectively an enterprise carried on by a resident of a Contracting State and an enterprise carried on by a resident of the other Contracting State; h) the term "international traffic" means any transport by a ship or aircraft operated by an enterprise of a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State; i) the term "competent authority" means: (i) in the case of India: the Finance Minister, Government of India, or his authorized representative; (ii) in the case of Korea: the Minister of Strategy and Finance, Government of Korea, or his authorized representative; j) the term "national" means: (i) any individual possessing the nationality of a Contracting State; (ii) any legal person, partnership or association deriving its status as such from the laws in force in a Contracting State; k) the term “tax” means Indian or Korean tax, as the context requires, but shall not include any amount which is payable in respect of any default or omission in relation to the taxes to which this Agreement applies or which represents a penalty or fine imposed relating to those taxes; l) the term “fiscal year” means: (i) in the case of India: the financial year beginning on the 1st day of April; (ii) in the case of Korea: the financial year beginning on the 1st day of January. 2. As regards the application of the Agreement at any time by a Contracting State, any term not defined therein shall, unless the context otherwise requires, have the meaning that it has at that time under the law of that State for the purposes of the taxes to which the Agreement applies, any meaning under the applicable tax laws of that State prevailing over a meaning given to the term under other laws of that State.