ITAT holds that indirect transfer of shares are subject to India-Ireland treaty protection
The Delhi Bench of the ITAT – International Tax, has recently delivered an important ruling1 clarifying the tax treatment of indirect transfer of shares of a US entity, deriving substantial value from assets located in India. The Tribunal held that such indirect transfers are covered under the residuary clause under Article 13 of the India-Ireland Double Taxation Avoidance Agreement (‘DTAA’), and thus, taxable only in the state of residence viz. Ireland.