India: Rate of dividend distribution tax may not be reduced under applicable treaty (tribunal decision)
15% rate of dividend distribution tax on dividends paid by an Indian company to non-resident shareholders
May not be reduced under applicable treaty (tribunal decision)
The Special Bench of the Mumbai Tribunal held that the 15% rate of dividend distribution tax on dividends paid by an Indian company to non-resident shareholders may not be reduced under an applicable income tax treaty because the tax is a tax on the profit of the company, not on the shareholders.
The case is: DCIT v. Total Oil India Pvt. Ltd.
KPMG observation
The dividend distribution tax is no longer applicable as of 1 April 2020.
Read an April 2023 report [PDF 263 KB] prepared by the KPMG member firm in India
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