Judgement on Constitutional validity of section 10(34) and draconian section 115BBDA

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Judgement on Constitutional validity of section 10(34) and draconian section 115BBDA

Judgement on Constitutional validity of section 10(34) and draconian section 115BBDA

 

Citation: [2019] 101 taxmann.com 328 (Delhi) Dated: 17.01.2019
Rajan Bhatia
v.
Central Board of Direct Taxes
Constitutional validity of section 10(34) and draconian section 115BBDA is challenged on ground that section 115BBDA does not have any ‘base’, and it makes hostile discrimination between a resident assessee and a non-resident assessee, as provision only applies to a resident assessee
• The High Court quashed the writ observing that the proviso to section 10(34) gives primacy to section 115BBDA over section 10(34) and that clause (a) of sub-section (1) of section 115BBDA is clear and categoric as it stipulates that dividend income upto Rs. 10 lacs is not to be charged to tax @ 10% under section 115BBDA. Dividend income of less than Rs. 10 lacs continues to remain exempt under section 10(34).
• The High Court further observed that non-residents are liable to pay tax in the country of their residence. Taxation regime applicable to non-residents need not be identical to that applicable to residents.

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