Section 40(a)(i) disallowances based on residential status doesn’t violate non-discrimination clauses of treaties

Dy. CIT v. Gupta Overseas [2014] 42 taxmann.com 42 (Agra - Trib.)

The Tribunal held as under:

1. As section 40(a)(i) creates differentiation based on residential status, it does not violate non-discrimination clauses of treaties which forbid discrimination based on nationalities; 
2. A differentiation in treatment due to residential status cannot be covered by the scope of Article 24(1)/ Art. 25(1)/Art. 26(1) as such a differentiation is not due to nationality factor.