35. Agreement for avoidance of
double taxation and prevention of fiscal evasion with
Whereas the
annexed Convention between the Republic of India and the Kingdom of Norway for the
avoidance of double taxation and the prevention of fiscal evasion with respect
to taxes on income and on capital has entered into force in the year one
thousand nine hundred and eighty-six, being the year in which it was signed, on
the notification by both the Contracting States to each other of the completion
of the procedures required under their laws, as required by paragraph (1) of
article 31 of the said Convention ;
Now,
therefore, in exercise of the powers conferred by section 44A of the Wealth-tax
Act, 1957 (27 of 1957), section 90 of the Income-tax Act, 1961 (43 of 1961) and
section 24A of the Companies (Profits) Surtax Act, 1964 (7 of 1964), the
Central Government hereby directs that all the provisions of the said
Convention shall be given effect to in the Union of India.
Notification
: No. GSR 756(E),
dated 9-9-1987, as amended by Notification No. 368/2006 [F. No. 505/3A/81-FTD],
dated 15-12-2006.
TEXT OF
ANNEXED CONVENTION, DATED 31-12-1986
The Government
of the Republic of India and the Government of the Kindgom
of Norway desiring to conclude a Convention for the avoidance of double
taxation and prevention of fiscal evasion with respect to taxes on income and
on capital, have agreed as follows:
ARTICLE 1 - Personal scope - This Convention
shall apply to persons who are residents of one or both of the Contracting
States.
ARTICLE 2 - Taxes covered - 1. The existing
taxes to which the Convention shall apply are, in particular:
(a) in
(i) the income-tax
including any surcharge thereon imposed under the Income-tax Act, 1961 (43 of
1961) ;
(ii) the surtax imposed
under the Companies (Profits) Surtax Act, 1964 (7 of 1964) ;
(iii) the wealth-tax
imposed under the Wealth-tax Act, 1957 (27 of 1957);
(hereinafter
referred to as “Indian tax”).
(b) In
(i) the national tax on
income (inntektsskatt til staten);
(ii) the county municipal
tax on income (inntektsskatt til
fylkeskommunen) ;
(iii) the municipal tax on
income (inntektsskatt til kommunen);
(iv) the national contributions to the Tax Equalisation Fund (fellesskatt til skattefordel-ingsfondet) ;
(v) the national tax on capital (formauesskatt til staten) ;
(vi) the municipal tax on capital (formuesskatt til kommunen) ;
(vii) the national tax relating to income and
capital form the exploration for and the exploitation of submarine petrolum resources and activities and work relating
thereto, including pipeline transport of petroleum produced (skatt til staten
vedr f rende inntekt go formue i forbindel-semed
under s o kelse etter og utnyttes av
undersj f ske petroleums-forekomaster og dertil knyttet
virksomhet og arbeid, hereunder r f redningstransport av utvunnet petroleum) ;
(viii) the national dues on
remuneration to non-resident artistes (av gift til staten av
honorarer som til faller kunstnere bosatt i utlandet);
(ix) the seamen’s tax (sj
f mannsskatt);
(hereinafter
referred to as “Norwegian tax”).
2. The Convention shall also apply to any
identical or substantially similar taxes which are imposed by either
ARTICLE 3 - General definitions - 1. In this
Convention, unless the context otherwise requires—
(a) the term “
(b) the term “Norway” means the Kingdom of Norway, including any area
outside the territorial waters of the Kingdom of Norway where the Kingdom of
Norway, according to Norwegian legislation and in accordance with international
law, may exercise her rights with respect to the sea-bed and subsoil and their
natural resources; the term does not comprise Svalbard
Jan mayen and the Norwegian dependencies outside Europe ;
(c) the terms “a
(d) the term “tax” means Indian tax or Norwegian tax, as the context
requires, but shall not include any amount which is payable in respect of any
default or omission in relation to the taxes to which this Convention applies
or which represents a penalty imposed relating to those taxes ;
(e) the term “person” includes an individual,
a company and any other entity which is treated as a taxable unit under the
taxation laws in force in the respective Contracting States ;
(f) the term “company” means any body
corporate or any entity which is treated as a company or body corporate under
the taxation laws in force in the respective Contracting States ;
(g) the terms “enterprise of a Contracting State” and “enterprise of
the other Contracting State” mean respectively an enterprise carried on by a
resident of a Contracting State and an enterprise carried on by a resident of
the other Contracting State ;
(h) the term “competent authority” means in
the case of
(i) the term “nationals”
means any individual possessing the nationality of a
(j) the term “international traffic” means any
transport by a ship or aircraft operated by an enterprise of a
2. As regards the application of the Convention
by a Contracting State, any term not defined therein shall, unless the context
otherwise requires, have the meaning which it has under the law of that State
concerning the taxes to which the Convention applies.
ARTICLE 4 - Resident - 1. For the purposes of
this Convention, the term “resident of a Contracting State” means any person who,
under the laws of that State, is liable to tax therein by reason of his
domicile, residence, place of management or any other criterion of a similar
nature.
2. Where, by reason of the provisions of
paragraph (1), an individual is a resident of both
(a) He shall be deemed to be a resident of the State in which he has a
permanent home available to him; if he has a permanent home available to him in
both States, he shall be deemed to be a resident of the State with which his
personal and economic relations are closer (centre of vital interests).
(b) If the State in which he has his centre of vital interests cannot
be determined, or if he has not a permanent home available to him in either
State, he shall be deemed to be a resident of the State in which he has an habitual abode.
(c) If he has an habitual abode in both States
or in neither of them, he shall be deemed to be a resident of the State of
which he is a national.
(d) If he is a national of both States or of neither of them, the
competent authorities of the Contracting States shall settle the question by
mutual agreement.
(3)
Where, by reason of the provisions of paragraph (1), a person other than
an individual is a resident of both Contracting States, then
it shall be deemed to be a resident of the State in which its place of
effective management is situated.
ARTICLE 5 - Permanent establishment - 1. For the
purposes of this Convention, the term “permanent establishment” means a fixed
place of business through which the business of an enterprise is wholly or
partly carried on.
(2) The
term “permanent establishment” includes especially—
(a) a place of management ;
(b) a branch ;
(c) an office ;
(d) a factory ;
(e) a workshop ;
(f) a mine, an oil or gas well, a quary or any other place of extraction of natural
resources ;
(g) a warehouse in relation to a person
providing storage facilities for others ;
(h) a farm, plantation or other place where
agricultural, forestry, plantation or related activities are carried on ;
(i) a premises used as a
sales outlet or for receiving or soliciting orders ;
(j) an installation or structure used for the
exploration of natural resources ;
(k) a building site, a construction, assembly or installation project
or supervisory activities in connection therewith, but only where such site,
project or activities continue for a period of more than three months together
with other such sites, projects or activities, if any ;
(l) the furnishing of services, including
consultancy services, by an enterprise through employees or other personnel
engaged by the enterprise for such purpose, but only where activities of that
nature continue (for the same or a connected project) within the country for a
period or periods aggregating to more than six months within any 12 months’
period.
3. Notwithstanding the preceding provisions of
this article, the term “permanent establishment” shall be deemd
not to include—
(a) the use of facilities solely for the
purpose of storage or display of goods or merchandise belonging to the
enterprise ;
(b) the maintenance of a stock of goods or
merchandise belonging to the enterprise solely for the purpose of storage or
display ;
(c) the maintenance of a stock of goods or
merchandise belonging to the enterprise solely for the purpose of processing by
another enterprise ;
(d) the maintenance of a fixed place of
business solely for the purpose of purchasing goods or merchandise, or of
collecting information, for the enterprise ;
(e) the maintenance of a fixed place of
business solely for the purpose of advertising, for the supply of information,
for scientific research, or for other activities which have a preparatory or
auxiliary character, for enterprise.
However, the
provisions of sub-paragraphs (a) to (e) shall not be applicable
where the enterprise maintains any other fixed place of business in the other
4. Notwithstanding the provisions of paragraphs
(1) and (2) where a person - other than an agent of an
independent status to whom paragraph (5) applies - is acting in a
(a) he has and habitually exercises in that
State an authority to conclude contracts on behalf of the enterprise, unless
his activities are limited to the purchase of goods or merchandise for the
enterprise ;
(b) he has no such authority, but habitually maintains in the
first-mentioned State a stock of goods or merchandise from which he regularly
delivers goods or merchandise on behalf of the enterprise ; or
(c) he habitually secures orders in the
first-mentioned State, wholly or almost wholly for the enterprise itself or for
the enterprise and other enterprises controlling, controlled by, or subject to
the same common control as, that enterprise.
5. An enterprise of a
6. The fact that a company which is a resident
of a Contracting State controls or is controlled by a company which is a
resident of the other Contracting State, or which carries on business in that
other State (whether through a permanent establishment or otherwise), shall not
of itself constitute either company a permanent establishment of the other.
ARTICLE 6 - Income from immovable property - 1.
Income derived by a resident of a
2. The term “immovable property” shall have the
meaning which it has under the law of the
3. The provisions of paragraph (1) shall
apply to income derived from the direct use, letting or use in any other form
of immovable property.
4. The provisions of paragraphs (1) and (3)
shall also apply to the income from immovable property of an enterprise and to
income from immovable property used for the performance of independent personal
services.
ARTICLE 7 - Business profits - 1. The profits of
an enterprise of a
(a) that permanent establishment ;
(b) sales in that other State of goods or merchandise of the same or
similar kind as those sold through that permanent establishment ; or
(c) other business activities carried on in
that other State of the same or similar kind as those effected through that
permanent establishment.
2. Subject to the provisions of paragraph (3),
where an enterprise of a Contracting State carries on business in the other Contracting
State through a permanent establishment situated therein, there shall in each
Contracting State be attributed to that permanent establishment the profits
which it might be expected to make if it were a distinct and separate
enterprise engaged in the same or similar activities under the same or similar
conditions and dealing wholly independently with the enterprise of which it is
a permanent establishment.
3. In the determination of the profits of a
permanent establishment, there shall be allowed as deductions expenses which
are incurred for the purposes of the permanent establishment, including
executive and general administrative expenses so incurred, whether in the State
in which the permanent establishment is situated or elsewhere, in accordance
with the provisions of and subject to the limitations of the taxation laws of
that State. However, no such deduction shall be allowed in respect of amounts,
if any, paid (otherwise than towards reimbursement of actual expenses) by the
permanent establishment to the head office of the enterprise or any of the
other offices, by way of royalties, fees or other similar payments in return
for the use of patents, know-how or other rights, or by way of commission or
other charges, for specific services performed or for management, or, except in
the case of a banking enterprise, by way of interest on moneys lent to the
permanent establishment. Likewise, no account shall be taken, in the
determination of the profits of a permanent establishment, for amounts charged (otherwise
then towards reimbursement of actual expenses), by the permanent establishment
to the head office of the enterprise or any of its other offices, by way of
royalties, fees or other similar payments in return for the use of patents,
know-how or other rights, or by way of commission or other charges for specific
services performed or for management, or except in the case of banking
enterprise, by way of interest on moneys lent to the head office of the
enterprise or any of its other offices.
4. Insofar as it has been customary in a
Contracting State to determine the profits to be attributed to a permanent
establishment on the basis of an apportionment of the total profits of the
enterprise to its various parts, nothing in paragraph (2) shall preclude
that Contracting State from determining the profits to be taxed by such an
apportionment as may be customary; the method of apportionment adopted shall,
however, be such that the result shall be in accordance with the principles
contained in this article.
5. No profits shall be attributed to a permanent
establishment by reason of the mere purchase by that permanent establishment of
goods or merchandise for the enterprise.
6. For the purposes of the preceding paragraphs,
the profits to be attributed to the permanent establishment shall be determined
by the same method year by year unless there is good and sufficient reason to
the contrary.
7. Where profits include items of income which
are dealt with separately in other articles of this Convention, then the
provisions of those articles shall not be affected by the provisions of this
article.
ARTICLE 8 - Air transport - 1. Profits derived
by an enterprise of a
2. The provisions of paragraph (1) shall
also apply to profits from the participation in a pool, a joint business or an
international operating agency.
3. The provisions of paragraphs (1) and (2)
shall apply to profits derived by the joint Norwegian, Danish and Swedish air
transport consortium, Scandinavian Airlines System (SAS), but only insofar as
profits derived by Det Norske
Luftfartsselskap A/S (DNL), the Norwegian partner of
the Scandinavian Airlines System (SAS), are in proportion to its share in that organisation.
4. For the purposes of this article, interest on
funds connected with the operation of aircraft in international traffic, shall
be regarded as profits derived from the operation of such aircraft, and the
provisions of article 12 shall not apply in relation to such interest.
5. The term “operation of aircraft” shall mean
business of transportation by air of passengers, mail, livestock or goods
carried on by the owners or lessees or charterers of
aircraft, including the sale of tickets for such transportation on behalf of
other enterprises, the incidental lease of aircraft and any other activity
directly connected with such transportation.
ARTICLE 9 - Shipping -
1. Profits derived by
an enterprise of a
2. Notwithstanding the provisions of paragraph (1)
profits derived from the operation of ships in international traffic may be taxed
in the
3. The provisions of paragraphs (1) and (2)
shall also apply to profits derived from the participation in a pool, in a joint
business or in an international operating agency.
4. An enterprise shall be deemed to be an
enterprise of both Contracting State if—
(a) the enterprise is carried on by a company
or any other body of persons where all the partners are jointly and severally
liable and at least one of the partners has unlimited liability ; and
(b) at least one of the partners is a resident of one of the
Contracting States and one or more of them is a resident of the other
Contracting State ; and
(c) the effective management of the enterprise
is not carried on solely in one of the Contracting States.
In that case,
the profits of the enterprise, subject to paragraph (2) of this article,
shall be taxable in the State where partners mentioned in sub-paragraph (b)
are residents in proportion to their part of the profits. The provisions of
this paragraph shall not be construed as to grant any benefits to partners resident of a State other than the Contracting
States.
5. For the purposes of this article, income from
the operation of ships includes income derived from the use, maintenance or
rental of containers (including trailers and related equipment for the
transport of containers) in connection with the transport of goods or
merchandise in international traffic.
ARTICLE 10 - Associated enterprises - Where—
(a) an enterprise of a
(b) the same persons participate directly or
indirectly in the management, control or capital of an enterprise of a
and in either
case conditions are made or imposed between the two enterprises in their
commercial or financial relations which differ from those which would be made
between independent enterprises, then any profits which would, but for those
conditions, have accrued to one of the enterprises, but, by reason of those
conditions, have not so accrued, may be included in the profits of that
enterprise and taxed accordingly.
ARTICLE 11 - Dividends
- 1. Dividends paid by
a company which is a resident of a
2. However, such dividends may also be taxed in
the
(a) 15 per cent of the gross amount of the dividends if the beneficial
owner is a company (other than a partnership) which holds directly at least 25
per cent of the capital of the company paying the dividends and the dividends
are attributable to a new contribution; and
(b) 25 per cent of the gross amount of the dividends in all other
cases.
This paragraph
shall not affect the taxation of the company in respect of the profits out of
which the dividends are paid.
3. The term “dividends” as used in this article
means income from shares or other rights, not being debt-claims, participating
in profits, as well as income from other corporate rights which is subjected to
the same taxation treatment as income from shares by the laws of the State of
which the company making the distribution is a resident.
4. The provisions of paragraphs (1) and (2)
shall not apply if the beneficial owner of the dividends, being a resident of a
Contracting State, carries on business in the other Contracting State of which
the company paying the dividends is a resident, through a permanent
establishment situated therein or performs in that other State independent
personal services from a fixed base situated therein, and the holding in
respect of which the dividends are paid is effectively connected with such
permanent establishment or fixed base. In such case, the provisions of article
7 or article 15, as the case may be, shall apply.
5. Where a company which is a resident of a
Contracting State derives profits or income from the other Contracting State,
that other State may not impose any tax on the dividends paid by the company,
except insofar as such dividends are paid to a resident of that other State or
insofar as the holding in respect of which the dividends are paid is effectively
connected with a permanent establishment or a fixed base situated in that other
State, nor subject the company’s undistributed profits to a tax on the
company’s undistributed profits, even if the dividends paid or the
undistributed profits consist wholly or partly of profits or income arising in
such other State.
6. As used in paragraph (2) of this
article, the term “new contribution” means share capital, other than bonus
shares, issued after the date of entry into force of this Convention by a company
which is a resident of a
ARTICLE 12 - Interest -
1. Interest arising in
a
2. However, such interest may also be taxed in
the Contracting State in which it arises, and according to the laws of that
State, but if the recipient is the beneficial owner of the interest and it is
paid in respect of a loan or debt first created after the date of entry into
force of this Convention, the tax so charged shall not exceed 15 per cent of
the gross amount of the interest.
3. Notwithstanding the provisions of paragraph (2),—
(a) interest arising in a
(i) the Government, a
political sub-division or a local authority of the other
(ii) the Central Bank of
the other
(b) interest arising in a Contracting State shall be exempt from tax in
that Contracting State to the extent approved by the Government of that State
if it is derived and beneficially owned by any person other than a person
referred to in sub-paragraph (a) who is a resident of the other
Contracting State provided that the transaction giving rise to the debt-claim
has been approved in this regard by the Government of the first-mentioned
Contracting State to be in the interest of the industrial development of that
State.
4. The term “interest” as used in this article
means income from debt-claims of every kind, whether or not secured by
mortgage, and in particular, income from Government securities and income from
bonds or debentures, including premiums and prizes attaching to such
securities, bonds or debentures. Penalty charges for late payment shall not be
regarded as interest for the purpose of this article.
5. The provisions of paragraphs (1) and (2)
shall not apply if the beneficial owner of the interest, being a resident of a
Contracting State, carries on business in the other Contracting State in which
the interest arises, through a permanent establishment situated therein or
performs in that other State independent personal services from a fixed base
situated therein, and the debt-claim in respect of which the interest is paid
is effectively connected with such permanent establishment or fixed base. In
such case, the provisions of article 7 or article 15, as the case may be, shall
apply.
6. Interest shall be deemed to arise in a
7. Where, by reason of a special relationship
between the payer and the beneficial owner or between both of them and some
other person, the amount of the interest, having regard to the debt-claim for
which it is paid, exceeds for whatever reason, the amount which would have been
agreed upon by the payer and the beneficial owner in the absence of such
relationship, the provisions of this article shall apply only to the
last-mentioned amount. In such a case, the excess part of the payments shall
remain taxable according to the laws of each
ARTICLE 13 - Royalties
and fees for technical services - 1. Royalties and fees for technical services arising in a
2. However, such royalties and fees for
technical services may also be taxed in the
3. The term “royalties” as used in this article
means payments of any kind received as a consideration for the use of, or the
right to use, any copyright of literary, artistic or scientific work, including
cinematograph films or films or tapes used for radio or television
broadcasting, any patent, trade mark, design or model, plan, secret formula or
process, or for the use of, or the right to use, industrial, commercial or
scientific equipment, or for information concerning industrial, commercial or scientific
experience.
4. The term “fees for technical services” as
used in this article means payments of any amount to any person other than
payments to an employee of a person making payments, in consideration for the
services of a managerial, technical or consultancy nature, including the
provision of services of technical or other personnel.
5. The provisions of paragraphs (1) and (2)
shall not apply if the beneficial owner of the royalties or fees for technical
services, being a resident of a Contracting State, carries on business in the
other Contracting State in which the royalties or fees for technical services
arise, through a permanent establishment situated therein, or perform in that
other State independent personal services from a fixed base situated therein,
and the right, property or contract in respect of which the royalties or fees
for technical services are paid is effectively connected with such permanent
establishment or fixed base in such a case, the provisions of article 7 or
article 15, as the case may be, shall apply.
6. Royalties and fees for technical services
shall be deemed to arise in a
7. Where, by reason of special relationship
between the payer and the beneficial owner or between both of them and some
other persons, the amount of royalties or fees for technical services paid
exceeds the amount which would have been paid in the absence of such
relationship, the provisions of this article shall apply only to the
last-mentioned amount. In such a case, the excess part of the payments shall
remain taxable according to the laws of each
ARTICLE 14 - Capital
gains - 1. Gains
derived by a resident of a
2. Gains from the alienation of movable property
forming part of the business property of a permanent establishment which an
enterprise of a Contracting State has in the other Contracting State or of
movable property pertaining to a fixed base available to a resident of a
Contracting State in the other Contracting State for the purpose of performing
independent personal services, including such gains from the alienation of such
a permanent establishment (along or with the whole enterprise) or of such fixed
base, may be taxed in that other State.
3. Gains from the alienation of ships or
aircraft operated in international traffic, or movable property (including
containers and related equipment) pertaining to the operation of such ships or
aircraft shall be taxable only in the
4. Gains from he alienation of shares of the
capital stock of a company, the property of which consists directly or
indirectly principally of immovable property situated in a
5. Gains from the alienation of shares other
than those mentioned in paragraph (4) in a company which is a resident
of a
6. Gains from the alienation of any property
other than that mentioned in the preceding paragraphs shall be taxable only in
the
ARTICLE 15 - Independent personal services - 1.
Income derived by an individual who is a resident of a Contracting State from
the performance of professional services or other activities of a similar
character shall be taxable only in that State except in the following
circumstances when such income may also be taxed in the other Contracting State
:—
(a) if he has a fixed base regularly available to him in the other
Contracting State for the purpose of performing his activities; in that case,
only so much of the income as is attributable to that fixed base may be taxed
in that other State ; or
(b) if his stay in the other Contracting State is for a period or
periods amounting to or exceeding in the aggregate 183 days in any two
consecutive years of income; in that case, only so much of the income as is
derived from his activities performed in that other State may be taxed in that
other State.
However, to
the extent the above-mentioned remuneration is not taxed in the State where the
recipient is a resident, the remuneration may be taxed in the other State.
2. The term “professional services” includes
especially independent scientific, literary, artistic, educational or teaching
activities, as well as the independent activities of physicians, surgeons,
lawyers, engineers, architects, dentists and accountants.
ARTICLE 16 - 1Dependent personal services - 1. Subject to the provisions of articles 17, 18, 19, 20, 21 and 22,
salaries, wages and other similar remuneration derived by a resident of a
2. Notwithstanding the provisions of paragraph (1),
remuneration derived by a resident of a
(a) the recipient is present in that other State for a period or
periods not exceeding in the aggregate 183 days in any two consecutive years of
income; and
(b) the remuneration is paid by, or on behalf
of, an employer who is a resident of the State of which the recipient is a
resident; and
(c) the remuneration is not reasonably
connected with the activities of a permanent establishment or a fixed base
which the employer has in the other State.
3. Notwithstanding the preceding provisions of
this article, remuneration derived in respect of an employment exercised aboard
a ship or aircraft operated in international traffic by an enterprise of a
ARTICLE 17 - Directors’
fees and remuneration of top level managerial officials - 1. Directors’ fees and similar payments derived
by a resident of a
2. Salaries, wages and other similar
remuneration derived by a resident of a
ARTICLE 18 - Income earned by entertainers and
athletes - 1. Notwithstanding the provisions of articles 15 and 16, income
derived by a resident of a Contracting State as an entertainer, such as a
theatre, motion picture, radio or television artiste, or a musician or as an
athlete, from his personal activities as such exercised in the other
Contracting State, may be taxed in that other State.
2. Where income in respect of personal
activities exercised by an entertainer or an athlete in his capacity as such
accrues not to the entertainer or athlete himself but to another person, that
income may, notwithstanding the provisions of articles 7, 15 and 16, be taxed
in the Contracting State in which the activities of the entertainer or athlete
are exercised.
3. Notwithstanding the provisions of paragraphs
(1) and (2), income derived from such activities as defined in
paragraph (1) shall be exempt from tax in the Contracting State in which
these activities are performed if the visit of the entertainer or athlete is
within the framework of cultural exchange between the two Contracting States,
or is directly or indirectly supported, wholly or substantially, from the
public funds of the other Contracting State, including a political sub-division
or local authority of that other State.
ARTICLE 19 - Remuneration and pensions in respect of Government service - 1.
(a) Remuneration, other than a pension paid by a Contracting State or a
political sub-division or a local authority thereof to an individual in respect
of services rendered to that State or sub-division or authority thereof in the
discharge of functions of a governmental nature shall be taxable only in that
State.
(b)
However, such remuneration shall be taxable only in the other Contracting State
if the services are rendered in that State and the individual is a resident of
that State who :
(i) is a national of that
State ; or
(ii) did not become a
resident of that State solely for the purpose of rendering the services.
2. (a) Any pension paid by, or out of
funds created by a Contracting State or a political sub-division or a local
authority thereof to an individual in respect of services rendered to that
State or sub-division or authority shall be taxable only in that State.
(b)
However, such pension shall be taxable only in the other Contracting State if :
(i) the individual is a
resident of, and a national of that other State; or
(ii) such pension is
exempt from tax in the first-mentioned State.
3. The provisions of articles 16, 17 and 20 shall
apply to remuneration and pensions in respect of services rendered in
connection with a business carried on by a
ARTICLE 20 - Non-Government pensions, annuities and
alimony - 1. Any pension, other than a pension referred to in article 19,
or any annuity derived by a resident of a
2. The term “pension” means a periodic payment
made in consideration of past services or by way of compensation for injuries
received in the course of performance of services.
3. The term “annuity” means a stated sum payable
periodically at stated times during life or during a specified or ascertainable
period of time under an obligation to make the payments in return for adequate
and full consideration in money or money’s worth.
4. Alimony received by a resident of
ARTICLE 21 - Payments received by students and
apprentices - 1. Payments which a student or business apprentice who
is or was immediately before visiting a Contracting State a resident of the
other Contracting State and who is present in the first-mentioned State solely
for the purpose of his education or training receives for the purpose of his
maintenance, education or training shall not be taxed in that State, provided that
such payments arise from sources outside that State.
2. In respect of grants, scholarships and
remuneration from employment not covered by paragraph (1), a student or
business apprentice described in paragraph (1) shall, in addition, be
entitled during such education or training to the same exemptions, reliefs or reductions in respect of taxes available to
residents of the State which he is visiting.
ARTICLE 22 - Other income - 1. Subject to
the provisions of paragraph (2), items of income of a resident of a
2. The provisions of paragraph (1) shall not
apply to income, other than income from immovable property as defined in
paragraph (2) of article 6, if the recipient of such income, being a
resident of a Contracting State, carries on business in the other Contracting
State through a permanent establishment situated therein, or performs in that
other State independent personal services from a fixed base situated therein,
and the right or property in respect of which the income is paid is effectively
connected with such permanent establishment or fixed base. In such a case, the
provisions of article 7 or article 15, as the case may be, shall apply.
3. Notwithstanding the provisions of paragraphs
(1) and (2), items of income of a resident of a Contracting State
not dealt with in the foregoing articles of this Convention and arising in the
other Contracting State may also be taxed in that other State.
ARTICLE 23 - Offshore activities - 1. The
provisions of this article have effect notwithstanding any other provision of
this Convention.
2. A person who is a resident of a Contracting
State and carries on activities offshore in the other Contracting State in
connection with the exploration or exploitation of the sea-bed and sub-soil and
their natural resources situated in that other State shall, subject to paragraphs
(3) and (4) of this article, be deemed in relation to those
activities to be carrying on business in that other State through a permanent
establishment or fixed base situated therein.
3. The provisions of paragraph (2) shall
not apply where the activities are carried on for a period not exceeding 30
days in the aggregate in any 12 months’ period. However, for the purposes of
this paragraph :
(a) activities carried on by an enterprise
associated with another enterprise shall be regarded as carried on by the
enterprise with which it is associated if the activities in question are
substantially the same as those carried on by the last-mentioned enterprise;
and
(b) two enterprises shall be deemed to be
associated if one is controlled directly or indirectly by the other, or both
are controlled directly or indirectly by a third person or persons.
4. Profits derived by a resident of a
Contracting State from the transportation of supplies or personnel to a
location, or between location, where activities in connection with the
exploration or exploitation of the sea-bed and subsoil and their natural
resources are being carried on in a Contracting State, or from the operation of
tugboats and other vessels auxiliary to such activities, shall be taxable only
in the Contracting State in which the place of effective management of the
enterprise is situated.
Notwithstanding
the provisions of this paragraph, profits derived from such operation may also
be taxed in the
5. (a) Subject to sub-paragraph (b)
of this paragraph, salaries, wages and similar remuneration derived by a
resident of a Contracting State in respect of an employment connected with the
exploration or exploitation of the sea-bed and subsoil and their natural
resources situated in the other Contracting State shall, to the extent that the
duties are performed offshore in that other State, be taxable only in that
other State provided that the employment offshore is carried on for a period
exceeding 30 days in the aggregate in any 12 months’ period.
(b)
Salaries, wages and similar remuneration derived by a resident of the
Contracting State in respect of an employment exercised aboard a ship or
aircraft engaged in the transportation of supplies or personnel to a location,
or between locations, where activities connected with the exploration or
exploitation of the sea-bed and subsoil and their natural resources are being
carried on in a Contracting State, or in respect of an employment exercised
aboard tugboats or other vessels operated of auxiliary to such activities,
shall be taxable only in the Contracting State in which the place of effective
management of the enterprise is situated.
ARTICLE 24 - Capital
- 1. Capital
represented by immovable property referred to in article 6, owned by a resident
of a
2. Capital represented by movable property
forming part of the business property of a permanent establishment which an
enterprise of a Contracting State has in the other Contracting State, or by
movable property pertaining to a fixed base available to a resident of a
Contracting State in the other Contracting State for the purpose of performing
independent personnel services, may be taxed in that other State.
3. Capital represented by ships and aircraft
operated in international traffic and by movable property (including containers
and related equipment) pertaining to the operation of such ships and aircraft,
shall be taxable only in the
4. All other elements of capital of a resident
of a
ARTICLE 25 - 1Elimination of double taxation - 1. The laws in force in either of
the Contracting States shall continue to govern the taxation of income and
capital in the respective Contracting States except where express provision to
the contrary is made in this Convention.
2. Where a resident of India derives income or
owns capital which, in accordance with the provisions of this Convention, may
be taxed in Norway, India shall allow as a deduction from the tax on the income
of that resident an amount equal to the income-tax paid in Norway, whether directly
or by deduction; and as a deduction from the tax on the capital of that
resident an amount equal to the capital tax paid in Norway. Such deduction in
either case shall not, however, exceed that part of the income-tax or capital
tax (as computed before the deduction is given) which is attributable, as the
case may be, to the income or the capital which may be taxed in
3. Where a resident of
4. Where a resident of Norway derives items of
income which, in accordance with the provisions of articles 9, 11, 12, 13, 14,
paragraphs (5), (17), (22) and (23) may be taxed in
India, Norway shall allow as a deduction from the tax on the income of that
person an amount equal to the tax paid in India. Such deduction shall not,
however, exceed that part of the tax, as computed before the deduction is
given, which is attributable to such items of income derived from
5. For the purposes of the deduction referred to
in paragraph (4), the term “income-tax paid in India” shall be deemed to
include any amount which would have been payable as Indian tax under the law of
India and in accordance with this Convention for any year but for an exemption
from, or reduction of, tax granted for that year under :—
(a) sections 10(4), 10(4A), 10(4B), 10(6)(viia), 10(15)(iv) and 80L of the
Income-tax Act, 1961 (43 of 1961), so, far as they were in force on, and have
not been modified since, the date of the signature of this Convention, or have
been modified only in minor respects so as not to affect their general
character ; or
(b) any other provisions which may be enacted after 11th November,
1983, granting a deduction in computing the taxable income or an exemption or
reduction from tax which the competent authorities of the Contracting States
agree to be for the purposes of the economic development of India, if it has
not been modified thereafter or has been modified only in minor respects so as
not to affect its general character.
This paragraph
does not apply to article 17.
6. For the deduction indicated in paragraph (4),
Indian tax on interest shall be considered as having been paid at a rate of not
less than 15 per cent.
7. The provisions of paragraphs (5) and (6)
of this article shall apply for the first 10 years for which this Convention is
effective, but the competent authorities of the Contracting States may consult
each other to determine whether this period shall be extended.
8. Where, under this Convention, a resident of a
Contracting State is exempt from tax in that Contracting State in respect of
income derived or capital owned in the other Contracting State, then the
first-mentioned Contracting State may, in calculating tax on the remaining
income or capital of that person, apply the rate of tax which would have been
applicable if the income or capital exempted from tax in accordance with this
Convention had not been so exempted.
ARTICLE 26 - Non-discrimination
- 1. Nationals of a
2. Stateless persons who are residents of a
3. The taxation on a permanent establishment
which an enterprise of a
4. Nothing contained in this article shall be
construed as obliging a
5. Except where the provisions of article 9,
paragraph (7) of article 12 or paragraph (7) of article 13 apply,
interest, royalties and other disbursements paid by an enterprise of a
Contracting State to a resident of the other Contracting State shall, for the
purpose of determining the taxable profits of such enterprise, be deductible
under the same conditions as if they had been paid to a resident of the
first-mentioned State. Similarly, any debts of an enterprise of a
6. Enterprises of a Contracting State the
capital of which is wholly or partly owned or controlled, directly or
indirectly, by one or more residents of the other Contracting State, shall not
be subjected in the first-mentioned Contracting State to any taxation or any
requirement connected therewith which is other or more burdensome than the
taxation and connected requirements to which other similar enterprises of the
first-mentioned State are or may be subjected in the same circumstances and
under the same conditions.
7. The provisions of this article shall not be
construed as obliging a
ARTICLE 27 - Mutual agreement procedure - 1.
Where a person considers that the actions of one or both of the Contracting
States result or will result for him in taxation not in accordance with the
provisions of this Convention, he may, irrespective of the remedies provided by
the domestic law of those States, present his case to the competent authority
of the Contracting State of which he is a resident, or if his case comes under
paragraph (1) of article 26, to that of the Contracting State of which
he is a national. The case must be presented within three years from the first
notification of the action resulting in taxation not in accordance with the
provisions of the Convention.
2. The competent authority shall endeavour, if the objection appears to it to be justified
and if it is not itself able to arrive at a satisfactory solution, to resolve
the case by mutual agreement with the competent authority of the other
3. The competent authorities of the Contracting
States shall endeavour to resolve by mutual agreement
any difficulties or doubts arising as to the interpretation or application of
the Convention. They may also consult together for the elimination of double
taxation in cases not provided for in the Convention.
4. The competent authorities of the Contracting
States may communicate with each other directly for the purpose of reaching an
agreement in the sense of the preceding paragraphs. When it seems advisable in
order to reach an agreement to have an oral exchange of options, such exchange
may take place through a Commission consisting of representatives of the
competent authorities of the Contracting States.
ARTICLE 28 - Exchange of information - 1.
The competent authorities of the Contracting States shall exchange such
information (including documents) as is necessary for carrying out the
provisions of the Convention or of the domestic laws of the Contracting States
concerning taxes covered by the Convention, insofar as the taxation thereunder is not contrary to the Convention, in particular
for the prevention of fraud or evasion of such taxes. The exchange of
information is not restricted by article 1. Any information received by a
2. In no case shall the provisions of paragraph
(1) be construed so as to impose on a
(a) to carry out administrative measures at
variance with the laws or administrative practice of that or of the other
(b) to supply information which is not
obtainable under the laws or in the normal course of the administration of that
or of the other
(c) to supply information which would disclose any trade, business,
industrial, commercial or professional secret or trade process, or information
the disclosure of which would be contrary to public policy.
ARTICLE 29 - Assistance in collection - 1.
The Contracting States undertake to lend assistance and support to each other
in the collection for taxes covered by this Convention which may no longer be
contested in the State making the request.
2. A request for assistance in the recovery of
tax claims of either of the Contracting States which may no longer be contested
in that State will be accepted for enforcement by the other Contracting State
and such tax claims shall be recovered in accordance with the laws and
administrative practice applicable to the enforcement and collection of its own
taxes.
3. The request for assistance in the recovery of
a tax claim shall be accompanied :
(a) by a declaration that the tax claim
concerns a tax covered by the Convention and that it may no longer be contested
;
(b) by an official copy of the instrument
permitting enforcement in the State making the request ;
(c) by any other document required for
recovery ; and
(d) where appropriate, by a certified copy of
any relevant decisions of the administrative body or a court of law.
4. In the case of Indian tax, the request will
be sent by the Central Board of Direct Taxes, Department of Revenue to the
Ministry of Finance, Government of the Kingdom of Norway, and, in the case of
Norwegian tax, the request will be sent by the Ministry of Finance to the
Central Board of Direct Taxes, Department of Revenue, in India.
5. Where the tax claim has not become final by
reason of being subject to appeal or any other proceeding, a
6. A request for assistance in collection of
taxes due from a taxpayer shall be made only if adequate assets of that
taxpayer are not available for recovering the taxes from him in the
7. The
ARTICLE 30 - Diplomatic and consular officials -
Nothing in this Convention shall affect the fiscal privileges of diplomatic or
consular officials under the general rules of international law or under the
provisions of special agreements.
ARTICLE 31 - Entry into force - 1. Each of
the Contracting States shall notify to the other the completion of the
procedures required by its law for the bringing into force of this Convention.
This Convention shall enter into force in the year in which it is signed and
shall thereupon have effect :
(a) in
(b) in
2. The agreement between the Government of
Norway and the Government of India for the avoidance of double taxation of
income, signed on the 20th July, 1959, shall terminate and cease to have effect
in respect of taxes on income to which the present agreement applies in
accordance with the provisions of paragraph (1) of this article.
ARTICLE 32 - Termination - This Convention shall
remain in force indefinitely but either of the Contracting States may, on or
before the thirtieth day of June in any calendar year beginning after the
expiration of a period of five years from the date of its entry into force,
give to the other Contracting State, through diplomatic channels, written
notice of termination. In such event, this Convention shall cease to have
effect:
(a) in India, in respect of income arising in any previous year
beginning on or after the first day of April next following the calendar year
in which the notice of termination is given and in respect of capital which is
held at the expiry of any fiscal year beginning on or after the first day of
April next following the calendar year in which the notice of termination is given ;
(b) in
IN WITNESS
WHEREOF the undersigned, duly authorised thereto, have signed the present Convention.
DONE IN
DUPLICATE at
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