FTC cannot be denied on the ground that corresponding income has not been offered for tax in the year under consideration.
Recently,ย ๐๐ต๐บ๐ฒ๐ฑ๐ฎ๐ฏ๐ฎ๐ฑย ๐ง๐ฟ๐ถ๐ฏ๐๐ปย ๐ถ๐ปย ๐๐๐๐งย ๐.ย ๐ฆ๐๐๐น๐ผ๐ปย ๐๐ป๐ฒ๐ฟ๐ด๐ย ๐๐๐ฑย [๐๐ง๐ย ๐ก๐ผ๐.ย ๐ญ๐ฑ๐ญ๐ณย &ย ๐ญ๐ฒ๐ฎ๐ญ/๐๐ต๐ฑ/๐ฎ๐ฌ๐ญ๐ต],ย ๐ฑ๐ฎ๐๐ฒ๐ฑย ๐ฎ๐ต.๐ญ๐ฌ.๐ฎ๐ฌ๐ฎ๐ฐ has held thatย FTC cannot be denied on the ground that corresponding income has not been offered for tax in the year under consideration.
Article 23 of India-China DTAA does not state that “FTC” is to be allowed only in the year in which corresponding income has been offered. It merely states that where resident of India derives royalty income which has been taxed in China, “India” shall allow as deduction from “tax” on income of that resident amount equal to “income tax paid in China” whether directly or by way of deduction.
The Copy of the order is as under:
