PERNOD RICARD INDIA PRIVATE LIMITED vs. COMMISSIONER OF INCOME TAX

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ITA - 29 / 2025HC Delhi06 February 20252 pages
For Petitioner: DEEPAK CHOPRA AZB & PARTNERS
AI SummaryAllowed

What did the High Court hold?

The High Court admitted the appeal on substantial questions of law. It will examine whether the DTAA rate of 5% on dividends is applicable instead of the domestic rate of 15% under Section 115-O, considering the provisions of Section 90(2) and Article 10(2)(a) of the India-Mauritius DTAA.

What were the facts?

The appellant, Pernod Ricard India Private Limited, is in appeal against the ITAT's decision regarding the applicable tax rate on dividends paid to its non-resident shareholder. The core dispute concerns whether the India-Mauritius DTAA rate or the domestic tax rate under Section 115-O should apply.

What were the issues?

The key issue is the applicability of the Double Taxation Avoidance Agreement (DTAA) rate versus the domestic tax rate on dividends paid to a non-resident shareholder. This involves interpreting Section 90(2) of the Income Tax Act and relevant articles of the India-Mauritius DTAA.

Which sections of the Income-tax Act were involved?

Section 90(2),Section 115-O

AI-generated summary — verify with the full judgment below

$~42 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 29/2025

PERNOD RICARD INDIA PRIVATE LIMITED .....Appellant Through: Mr. Anmol Anand and Ms. Priya Tandon, Advocates

versus

COMMISSIONER OF INCOME TAX

.....Respondent Through: Mr. Anurag Ojha, SSC with Ms. Hemlata Rawat and Mr. V.K. Saksena, JSCs

CORAM:

HON'BLE THE CHIEF JUSTICE

HON'BLE MR. JUSTICE TUSHAR RAO GEDELA

O R D E R %

06.02.2025 CM APPL. 7035/2025 1. Exemption allowed subject to all just exceptions. 2. The application stands disposed of. ITA 29/2025 3. Admit on the following substantial questions of law:- A. Whether in terms of section 90(2) of the Act, the applicable income-tax rate on dividends paid by the Appellant to its non-resident shareholder i.e., Peri Mauritius would be 5% (inclusive of surcharge and cess) as per Article 10(2)(a) of the Double Taxation Avoidance Agreement between India and Mauritius instead of 15% (plus surcharge and cess) as provided for in section 115-O of the Act for This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:05:10

Assessment Year 2014-15?

B. Without prejudice, whether the Tribunal erred in not appreciating that since in view of Article 23(4)(b) of the Double Taxation Avoidance Agreement between India and Mauritius, levy of dividend distribution tax was specifically covered within Article 3(1)(d) of the Double Taxation Avoidance Agreement between India and Mauritius, therefore, the lower rate of tax i.e., 5% (inclusive of surcharge and cess) as provided for under Article 10(2) of the Double Taxation Avoidance Agreement between India and Mauritius should apply instead of 15% (exclusive of surcharge and cess) as provided under section 115-O of the Act? 4. Issue notice. On behalf of the respondent Mr. Anurag Ojha, learned SSC accepts notice. 5. List on 05.05.2025. 6. Matter to be tagged with ITA 405/2024.

DEVENDRA KUMAR UPADHYAYA, CJ

TUSHAR RAO GEDELA, J FEBRUARY 6, 2025 Aj This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:05:10

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