AGREEMENT BETWEEN
INDIA AND JORDAN.Whereas
the annexed Convention between the Government of the Republic of India and the
Government of the Hashemite Kingdom of Jordan for the avoidance of double
taxation and the prevention of fiscal evasion with respect tot taxes on income,
has entered into force on the 16th day of October, 1999, in accordance with
article 29 of the said Convention, thirty days after the receipt of the later
of the notifications by both the Contracting States to each other of the completion
of the procedures required by their respective laws for bringing into force of
the said Convention:Now,
therefore, in exercise of the powers conferred by section 90 of the Income-tax
Act, 1961 (43 of 1961), the Central Government hereby directs that all the
provisions of the said Convention shall be given effect to in the Union of
India.ANNEXURECONVENTION
BETWEEN THE GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE
HASHEMITE KINGDOM OF JORDAN FOR THE ACOIDANCE OF DOUBLE TAXATION AND THE
PREVENTION OF FISCAL EVASION WITH RESPECT TO TAXES ON INCOME.THE
GOVERNMENT OF THE REPUBLIC OF INDIA AND THE GOVERNMENT OF THE HASHEMITE KINGDOM
OF JORDANDesiring
to conclude a Convention for the avoidance of double taxation and the
prevention of fiscal evasion with respect to taxes on income and with a view to
promoting economic co-operation between the two countries have agreed as
follows:Article
1PERSONAL
SCOPEThis
Convention shall apply to persons who are residents of one or both of the Contracting
States.Article
2TAXES
COVERED1. This Convention shall
apply to taxes on income imposed on behalf of a Contracting State or of its
political sub-divisions or local authorities irrespective of the manner in
which they are levied.2. There shall be regarded
as taxes on income all taxes imposed on total income or on element of income
including taxes on gains from the alienation of movable or immovable property
and taxes on the total amounts of wages or salaries paid by enterprises.3. The existing taxes to
which the Convention shall apply are in particular:a. in India;the
income-tax, including any surcharge thereon(hereinafter
referred to as "Indian tax").a.b. In Jordan:I.
the
income tax;II.
the
distribution tax; andIII.
the
social service tax(hereinafter
referred to as "Jordanian tax").1.2.3.4. The Convention shall
apply also to any identical or substantially similar taxes which are imposed
after the date of signature of the Convention in addition to, or in place of
the existing taxes referred to in paragraph 3. The competent authorities of the
Contracting State shall notify each other of significant changes which have
been made in their respective taxation laws.Article
3GENERAL
DEFINITIONS1. For the purpose of
this Convention, unless the context otherwise requires:a. the term
"India" means the territory of India and includes the territorial sea
and airspace above it, as well as any other maritime zone in which India has
sovereign rights, other rights and jurisdiction, according to the Indian law
and in accordance with international law, including the U.N. Convention on the
law of the Sea;b. the term
"Jordan" means the territories of the Hashemite Kingdom of Jordan,
the territorial waters of Jordan and airspace above it, and the seabed and
sub-soil of the territorial waters, and includes any area extending beyond the
limits of the territorial waters of Jordan, and the Seabed and sub-soil of any
such area, which has been or may hereafter be designated, under the laws of
Jordan, and in accordance with international law as an area over which Jordan
has sovereign rights for the purposes of exploring and exploiting the natural
resources, whether living or non-living;c. the term
"person" includes an individual, a company, a body of persons and any
other entity which is treated a s a taxable unit under the taxation laws in
force in the respective Contracting States;d. the term
"company means any body corporate or any entity which is treated as a body
corporate for tax purposes;e. 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 Statef. the term
"international traffic" means any transport by a ship or aircraft
operated by an enterprise which is a resident of a Contracting State, except
when the ship or aircraft is operated solely between places in the other
Contracting State;g. the term
"competent authority" means;i.
in
India: the Central Government in the Ministry of Finance (Department of
Revenue) or their authorized representative;ii.
in
Jordan: the Minister of Finance or his authorized representative;a.b.c.d.e.f.g.h. the term
"national" means:i.
any
individual possessing the nationality of a Contracting State;ii.
any
legal person, partnership or association deriving its status as such from the
laws in force in a Contracting State;a.b.c.d.e.f.g.h.i. the term "fiscal
year" means;i.
in
the case of India, " previous year" as defined under section 3 of the
Income-tax Act, 1961;ii.
in
the case of Jordan, "the year" as defined in article 2 of the
Income-tax Law (57 of 1985);a.b.c.d.e.f.g.h.i.j. the term
"tax" means Indian tax or Jordanian 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 or fine imposed relating to those taxes.k. The terms " a
Contracting State" and " the other Contracting State" mean the
Republic of India or the Hashemite Kingdom of Jordan as the context requires.1.2. 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
4RESIDENT1. 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. But this term does not include any person who is liable to tax
in that State in respect only of income from sources in that State.2. Where by reason of
the provisions of paragraph 1 an individual is a resident of both Contracting
States, then his status shall be determined as follows: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 ("center of vital interests");b. if the State in which
he has his center 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.1.2.3. 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. If the State in
which its place of effective management is situated cannot be determined, then
the competent authorities of the Contracting States shall settle the question
by mutual agreement.Article
5PERMANENT
ESTABLISHMENT1. 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, quarry or any other place of exploration, exploitation or extraction of
natural resources;g. a sales outlet;h. a warehouse in
relation to a person providing storage facilities for others; andi. a farm, plantation or
other place where agricultural, forestry, plantation or related activities are
carried on.1.2.3. A building site or
construction or assembly project or installation project or supervisory
activities in connection therewith constitute a permanent establishment only if
such site, project or activity lasts more than six months.4. An enterprise shall
be deemed to have a permanent establishment in a Contracting State and to carry
on business through that permanent establishment if it provides services or
facilities in connection with, or supplies plant and machinery on hire used for
or to be used in the prospecting for, or extraction or exploitation of mineral
oils in that State.5. Notwithstanding the
preceding provisions of this article, the term "permanent
establishment" shall be deemed not to include:a. the use of facilities
solely for the purpose of storage, display or delivery 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, display or delivery;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 carrying on, for the
enterprise, any other activity of a preparatory or auxiliary character.f. The maintenance of a
fixed place of business solely for any combination of activities mentioned in
sub-paragraphs (a) to (e), provided that the overall activity of the fixed
place of business resulting from this combination is of a preparatory or
auxiliary character.1.2.3.4.5.6. Notwithstanding the
provisions of paragraphs 1 and 2, where a person other than an agent of an
independent status to whom paragraph 8 applies is acting on behalf of an
enterprise and has, and habitually exercises, in a Contracting State an
authority to conclude contracts in the name of the enterprise, that enterprise
shall be deemed to have a permanent establishment in that State in respect of
any activities which that person undertakes for the enterprise, unless the
activities of such person are limited to those mentioned inn paragraph 5 which,
if exercised through a fixed place of business, would not make this fixed place
of business a permanent establishment under the provisions of that paragraph.7. Notwithstanding the
preceding provisions of this article an insurance enterprise of a Contracting
State shall, except in regard to re-insurance, be deemed to have a permanent
establishment in the other Contracting State if it collects premiums in the
territory of that other State or insures risks situated therein through a
person other than an agent of an independent status to whom paragraph 8
applies.8. An enterprise shall
not be deemed to have a permanent establishment in a Contracting State merely
because it carries on business in that State through a broker, general
commission agent or any other agent of an independent status, provided that
such persons are acting in the ordinary course of their business. However, when
the activities of such an agent are devoted wholly or almost wholly on behalf
of that enterprise, he will not be considered an agent of an independent status
within the meaning of this paragraph.9. 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 or a permanent
establishment of the other.Article
6INCOME
FROM IMMOVABLE PROPERTY1. Income derived by a
resident of a Contracting State from immovable property (including income from
agriculture or forestry) situated in the other Contracting State may also be
taxed in that other State.2. The term
"immovable property" shall have the meaning which it has under the law
of the Contracting State in which the property in question is situated. The
term shall in any case include property accessory to immovable property,
livestock and equipment used in agriculture and forestry, rights to which the
provisions of general law respecting landed property apply, usufruct of
immovable property and rights to variable or fixed payments as consideration
for the working of, or the right to work, mineral deposits, sources and other
natural resources; ships, boats, aircraft and motor vehicles shall not be
regarded as immovable property.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 and3 shall 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
7BUSINESS
PROFITS1. The profits of an
enterprise of a Contracting State shall be taxable only in that State unless
the enterprise carries on business in the other Contracting State through a
permanent establishment situated therein. If the enterprise carries on business
as aforesaid, the profits of the enterprise may also be taxed in the other
State but only so much of them as is attributable to 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 determining the
profits of a permanent establishment, there shall be allowed a 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 tax
laws of that State.4. 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.5. 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.6. 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
8SHIPPING
AND AIR TRANSPORT1. Profits derived by an
enterprise of a Contracting State from the operation by that enterprise of
ships or aircraft in international traffic shall be taxable only in that State.2. For the purposes of
this article, profits from the operation of ships or aircraft in international
traffic shall mean profits derived by an enterprise described in paragraph 1
from the transportation by sea or air respectively of passengers mail,
livestock or goods carried on by the owners or lessees or charterers of ships
or aircraft including-a. the sale of tickets
for such transportation on behalf of other enterprises;b. other activity directly
connected with such transportation; andc. the rental of ships
or aircraft incidental to any activity directly connected with such
transportation.3. Profits of an
enterprise of a Contracting State described in paragraph 1 from the use,
maintenance, or rental of containers (including trailers, barges and related
equipment for the transport of containers) used in connection with the
operation of ships or aircraft in international traffic shall be taxable only
in that State.4. The provisions of
paragraphs 1 and 3 shall also apply to profits from participation in a pool, a
joint business or code sharing, or an international operating agency.5. For the purposes of
this article, interest on funds connected with the operation of ships or
aircraft in international traffic shall be regarded as profits derived from the
operation of such ships or aircraft, and the provisions of article 11
(interest) shall not apply in relation to such interest.6. Gains derived by an
enterprise of a Contracting State described in paragraph 1 from the alienation
of ships, aircraft or containers owned and operated by the enterprise, the
income from which is taxable only in that State, shall be taxed only in that
State.7. Notwithstanding the
preceding provisions of this article, income derived by an enterprise of a
Contracting State from the operation of ships between the ports of the other
Contracting State and the ports of third countries may be taxed in that other
Contracting State, but the tax imposed in that other State shall be reduced by
an amount equal to 50 per cent. Thereof.Article
9ASSOCIATED
ENTERPRISES1. Where:a. an enterprise of a
Contacting State participates directly or indirectly in the management, control
or capital of an enterprise of the other Contracting State; orb. the same persons participate
directly or indirectly in the management, control or capital of an enterprise
of a Contracting State and an enterprise of the other Contracting State,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.1.2. Where a Contracting
State includes in the profits of an enterprise of that State And taxes
accordingly-profits on which an enterprise of the other Contracting State has
been charged to tax in that other State and the profits so included are profits
which would have accrued to the enterprise of the first mentioned State if the
conditions made between the two enterprises had been those which would have
been made between independent enterprises, then that other State shall make an
appropriate adjustment to the amount of the tax charged therein on those
profits. In determining such adjustment, due regard shall be had to the other
provisions of this Convention and the competent authorities of the Contracting
States shall, if necessary, consult each other.Article
10DIVIDENDS1. Dividends paid by a
company which is a resident of a Contracting State to a resident of the other
Contracting State may be taxed in that other State.2. However, such dividends
may also be taxed in the Contracting State of which the company paying the
dividends is a resident and according to the laws of that State, but if the
recipient is the beneficial owner of the dividends the tax so charged shall not
exceed 10 per cent. Of the gross amount of the dividends. 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 14, 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 in so far as such dividends are paid to a resident
of that other State or in so far 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.Article
11INTEREST1. Interest arising in a
Contracting State and paid to a resident of the other Contracting State may be
taxed in that other State.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 the tax so charged shall not exceed 10 per cent. of the
gross amount of the interest. The competent authorities of the Contracting
States shall by mutual agreement settle the mode of application of this
limitation.3. Notwithstanding the
provisions of paragraph 2, interest arising in a Contracting State shall be
exempt from tax in that State provided it is derived and beneficially owned by-i.
the
Government, a political sub-division or a local authority of the other
Contracting State; orii.
the
Central Bank of the other Contracting State, or any other bank or governmental
financial institutions/agencies that may be mutually agreed upon between the
two Contracting States.1.2.3.4. The term "interest"
as used in this article means income from debt-claims of every kind, whether or
not secured by mortgage and whether or not carrying a right to participate in
the debtor's profits, and in particular, income from Government securities and
income from bonds or debentures, including premiums and prizes attaching to
such securities, bonds or debenture. Penalty charges for late payment shall not
be regarded as interest for the purposes of this article.5. The provisions of
paragraphs 1and 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 14, as the case may be, shall, apply.6. Interest shall be
deemed to arise in a Contracting State when the payer is that State itself, a
political sub-division, a local authority or a resident of that State. Where,
however, the person paying the interest, whether he is a resident of a
Contracting State or not, has in a Contracting State a permanent establishment
or a fixed base in connection with which the indebtedness on which the interest
is paid was incurred, and such interest is borne by such permanent
establishment or fixed base, then such interest shall be deemed to arise in the
Contracting State in which the permanent establishment or fixed base is
situated.7. Where, by reason of a
special relationship between the prayer 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 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 case, the excess part of the payments shall remain
taxable according to the laws of each Contracting State, due regard being had
to the other provisions of this Convention.Article
12ROYALTIES
AND FEES FOR TECHNICAL SERVICES1. Royalties or fees for
technical services arising in a Contracting State and paid to a resident of the
other Contracting State may be taxed in that other State.2. However, such
royalties or fees for technical services may also be taxed in the Contracting
State in which they arise and according to the laws of that State, but if the
recipient is the beneficial owner of the royalties or fees for technical
services the tax so charged shall not exceed 20 per cent. of the gross amount
of the royalties or fees for technical services.3.a. 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 and
films or tapes or any other means of reproduction for television or radio
broadcasting, any patent, trade mark, design or model, plan, secret formula or
process, any industrial, commercial or scientific equipment or for information
concerning industrial, commercial or scientific experience;b. The term "fees
for technical services" means payment of any kind in consideration for the
rendering of any managerial, technical or consultancy services including the
provision of services by technical or other personnel but does not include
payments for services mentioned in articles14 and 15 of this Convention.1.2.3.4. The provisions of
paragraphs 1 and 2 shall 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 performs in that other State independent personal services from a fixed base
situated therein, and the right or property 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 case the provisions of article 7
or article 14, as the case may be, shall apply.5. Royalties or fees for
technical services shall be deemed to arise in a Contracting State when the
payer is that State itself, a political sub-division, a local authority or a
resident of that State. Where, however, the person paying the royalties or fees
for technical services, whether he is a resident of a Contracting State or not,
has in a Contracting State a permanent establishment or a fixed base in
connection with which the liability to pay the royalties or fees for technical
services are borne by such permanent establishment, or fixed base then such
royalties or fees for technical services shall be deemed to arise in the State
in which the permanent establishment or fixed base is situated.6. 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 royalties or fees for
technical services having regard to the amount of the royalties or fees for
technical services having regard to the use, right or information for which
they are paid, exceeds 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 case, the excess part of the payments shall remain taxable according to
the laws of each Contracting State, due regard being had to the other
provisions of this Convention.Article
13CAPITAL
GAINS1. Gains derived by a
resident of a Contracting State from the alienation of immovable property
referred to in article 6 and situated in the other Contracting State may also
be taxed in that other State.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 (alone or with the whole
enterprise) or of such fixed base, may also be taxed in that other State.3. Gains derived by an
enterprise of a Contracting State from the alienation of ships or aircraft
operated in international traffic or movable property pertaining to the
operation of such ships or aircraft shall be taxable only in that State.4. Gains from the
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
Contracting State may be taxed in that State.5. Gains from the
alienation of any property other than that referred to in paragraphs 1,2,3, and
4, shall be taxable only in the Contracting State of which the alienator is a
resident, provided that such resident is subject to tax thereon in that State.
If the resident is not subject to tax thereon, then such gains may be taxed in
the other Contracting State.Article
14INDEPENDENT
PERSONAL SERVICES1. Income derived by a
resident of a Contracting State in respect of professional services or other
activities of an independent 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; orb. If his stay in the
other State is for a period or periods aggregating 183 days or more in any
12-month period commencing or ending in the fiscal year concerned; 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; orc. If the remuneration
for his activities in the other Contracting State is paid by a resident of that
Contracting State or is borne by a permanent establishment or a fixed bas
situated in that Contracting State and exceeds in the fiscal year the
equivalent of US $ 2000.1.2. The term
"professional services " includes especially independent scientific,
literary, artistic, educational or teaching activities as well as the
independent activities of physicians, lawyers, engineers, architects, surgeons,
dentists and accountants.Article
15DEPENDENT
PERSONAL SERVICES1. Subject to the
provisions of articles 16, 18, and 19 salaries, wages, and other similar
remuneration derived by a resident of a Contracting State in respect of an
employment shall be taxable only in that State unless the employment is
exercised in the other Contracting State. If the employment is so exercised,
such remuneration as is derived therefrom may be taxed in that other state.2. Notwithstanding the
provisions of paragraph 1, remuneration derived by a resident of a Contracting
State in respect of an employment exercised in the other Contracting State
shall be taxable only in the first mentioned State if:i.
The
recipient is present in the other State for a period or periods not exceeding
in the aggregate 183 days in any 12-month period commencing or ending in the
fiscal year concerned; andii.
The
remuneration is paid by, or on behalf of, an employer who is not a resident of
the other State; andiii.
If
the remuneration is not borne by a permanent establishment or a fixed base
which the employer has in the other State.1.2.3. Notwithstanding the
preceding provisions of this article, remuneration derived in respect of an
employment exercised aboard a ship or aircraft operated by an enterprise which
is a resident of a Contracting State in international traffic shall be taxable
only in that Contracting State.Article
16DIRECTOR'S
FEESDirectors'
fees and other similar payments derived by a resident of a Contracting State in
his capacity as a member of the board of directors of a company which is a
resident of the other Contracting State may also be taxed in that other State.Article
17ARTISTES
AND SPORTMEN1. Notwithstanding the
provisions of articles 14 and 15 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 a sportsman, 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 a sportsman in
his capacity as such accrues not to the entertainer or sportsman himself but to
another person, that income may, notwithstanding the provisions of articles
7,14, and 15, be taxed in the Contracting State in which the activities of the
entertainer or sportsman are exercised.3. The provisions of
paragraphs 1 and 2, shall not apply to income from the visit to that State is
substantially supported by public funds of one or both of the Contracting
States or of political sub-divisions or local authorities thereof. In such a
case, the income is taxable only in the Contracting State of which the
entertainer or sportsman is a resident.Article
18PENSIONS1. Subject to the
provisions of paragraph 2 of article 19, pensions and other similar
remuneration paid to a resident of a Contracting State in consideration of past
employment shall be taxable only in that State.2. Notwithstanding the
provisions of paragraph 1, pensions paid and other payments made under a public
scheme which is part of the social security system of a Contracting State or a
political sub-division or a local authority thereof shall be taxable only in
that State.Article
19GOVERNMENT
SERVICE1.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 shall b taxable only in that State.a.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; orii.
did
not become a resident of that State solely for the purpose of rendering th
services.1.2.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 the individual is a
resident of, and a national of, that State.1.2.3. The provisions of
articles 15, 16 and 18 shall apply to remuneration and pensions in respect of
services rendered in connection with a business carried on by a Contracting
State or a political sub-division or a local authority thereof.Article20STUDENTS
AND APPRENTICES1. A student or business
apprentice who is or was a resident of a Contracting State immediately before
visiting the other Contracting State and who is present in that other Contracting
State slowly for the purpose of his education or training shall be exempt from
tax in that other State on:i.
Payments
made to him by persons residing outside that other State for the purposes of
this maintenance, education or training; andii.
Remuneration
from employment in that other State in an amount not exceeding US $ 500 or its
equivalent amount during any fiscal year, as the case may be, provided that
such employment is directly related to his studies or is undertaken for the
purpose of his maintenance.1.2. The benefit of this
article shall extend only for such period of time as may be reasonable or
customarily required to complete the education or training undertaken, but in
no event shall any individual have the benefit of this article for more than
five consecutive years from the date of his first arrival in that other
Contracting State.Article
21PROFESSORS,
TEACHERS AND RESEARCH SCHOLARS1. A professor or
teacher who is or was a resident of the Contracting State immediately before
visiting the other Contracting State for the purpose of teaching or engaging in
research, or both, at a university, college, school or other approved
institution in that other Contracting State shall be exempt from tax in that
other State on any remuneration for such teaching or research for a period not
exceeding one year from the date of his arrival in that other State.2. This article shall
not apply to income from research, if such research, if such research is
undertaken primarily for the private benefit of a specific person or persons.3. For the purposes of
this article and article 20, an individual shall be deemed to be a resident of
a Contracting State if he is resident in that State in the fiscal year in which
he visits the other Contracting State or in the immediately preceding fiscal
year.4. For the purposes of
paragraph 1 "approved institutions" means an institution which has
been approved in this regard by the competent authority of the concerned State.Article
22OTHER
INCOME1. Items of income of a
resident of a Contracting State, wherever arising, not dealt with in the
foregoing articles of this Convention shall be taxable only in that State.2. The provisions of
paragraph 1 shall not apply to income, other than income from immovable
property a 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 case the provisions of article 7 or article 14, as the case may be,
shall apply.3. Notwithstanding the
provisions of paragraph 1 if a resident of a Contracting State derives income
from sources within the other Contracting State in the form of lotteries,
crossword puzzles, races including horse races, card games and other games of
any sort or gambling or betting of any form or nature whatsoever, such income
may be taxed in the other Contracting State.Article
23ELIMINATION
OF DOUBLE TAXATION1. The laws in force in
either of the Contracting State will continue to govern the taxation of income
in the respective Contracting States except where provisions to the contrary
are made in this Convention.2. In the case of India,
double taxation shall be eliminated as follows:Where
a resident of India derives income which, in accordance with the provisions of
this Convention, may be taxed in Jordan, India shall allow as a deduction from
the tax on the income of that resident a deduction oat source. Such amount
shall not, however, exceed that part of the income- tax as compute before the
deduction is given, which is attributable to the income which may be taxed in
Jordan.1.2.3. In the case of
Jordan, double taxation shall be eliminated as follows:Where
a resident of Jordan derives income which, in accordance with the provisions of
this Convention, may be taxed in India, Jordan shall allow as a deduction from
the tax on the income of that resident an amount equal to the income-tax paid
in India. Such deduction shall not, however, exceed that part of the income-
tax, as computed before the deduction is given, which is attributable to the
income which may be taxed in India.4. The tax payable in
the Contracting State mentioned in paragraphs 2 and 3 of this article shall be
deemed to include the tax which would have been payable but for the tax
incentives granted under the laws of the Contracting State and which are
designed to promote economic development.5. Income which is
accordance with the provisions of this Convention, is not to be subjected to
tax in a Contracting State, may be taken into account for calculating the rate
of tax to be imposed in that Contracting State.Article
24NON-DISCRIMINATION1. Nationals of a
Contracting State shall not be subjected in the other Contracting State to any
taxation or any requirement connected therewith, which is other or more
burdensome than the taxation and connected requirements to which nationals of
that other State in the same circumstances in particular with respect to
residence are or may be subjected. This provision shall, notwithstanding the
provisions of article 1, also apply to persons who are not residents of one or
both of the Contracting States.2. The taxation on a
permanent establishment which an enterprise of a Contracting State has in the
other Contracting State shall not be les favourably levied in that other State
than the taxation levied on enterprises of that other State carrying on the
same activities. This provision shall not be construed as preventing a
Contracting State from granting to residents of the other Contracting State any
personal allowances reliefs and reductions for taxation purposes on account of
civil status or family responsibility which it grants to his own residents.3. Enterprises of a
Contracting State, the capital of which is wholly or partly owed or controlled,
directly or indirectly by one or more residents of the other Contracting State,
shall not be subjected in the first-mentioned 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.4. Expect where the
provisions of article 9, paragraph 7 of article 11 or paragraph 6 of article 12
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 a if they had been paid to a resident of the first
-mentioned State.5. The provisions of
this article shall, notwithstanding the provisions of article 2, apply to taxes
of every kind an description which are the subject of this Convention.Article
25MUTUAL
AGREEMENT PROCEDURE1. Where a person
considers that the actions of one or both the Contracting State 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 24, 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 ad 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 contracting State
with a view to the avoidance of taxation which is not in accordance with the
Convention. Any agreement reached shall be implemented notwithstanding any time
limits in the domestic law of the Contracting States.3. The competent
authorities of the Contracting States shall endeavour to resolve by mutual
agreement any difficulties or doubts arising ass 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 agreement to have an oral
exchange of opinions, such exchange may take place through a Commission
consisting of representatives of the competent authorities of the Contracting
States.Article
26EXCHANGE
OF INFORMATION1. The competent
authorities of the Contracting States shall exchange such information
(including documents), as is necessary for carrying out the provisions of this
Convention or of the domestic laws of the Contracting State concerning taxes
covered by the convention in so far as the taxation there under 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 Contracting State shall be treated as secret in the
same manner as information obtained under the domestic laws of that State and
shall be disclosed only to persons or authorities (including courts and
administrative bodies) involved in the assessment or collection of, the enforcement
or prosecution in respect of, or the determination of appeals in relation to,
the taxes covered by the Convention. Such persons or authorities shall use the
information only for such purposes. They may disclose the information in public
court proceedings or in judicial decisions.2. In no case shall the
provisions of paragraph 1 be construed so as to impose on a Contracting State
the obligation:i.
To
carry out administrative measures at variance with the laws and administrative
practice of that or of the other Contracting State;ii.
To
supply information or documents which is not obtainable under the laws or in
the normal course of the administration of that or of the other Contracting
State;iii.
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
27COLLECTION
ASSISTANCE1. The Contracting
States undertake to lend assistance to each other in the collection of taxes to
which this Convention relates, together with interest, costs, and civil
penalties relating to such taxes, referred to in this article as a
"revenue claim".2. Requests for
assistance by the competent authority of a Contracting State in the collection
of revenue claim shall include a certification by such authority that, under
the laws of that State, the revenue claim has been finally determined. For the
purposes of this article, a revenue claim is finally determined when a
Contracting State has the right under its internal law to collect the revenue
claim and the taxpayer has no further rights to restrain collection.3. Amounts collected by
the competent authority of a Contracting State pursuant to this article shall
be forwarded to the competent authority of the other Contracting State,
However, the first-mentioned Contracting State shall be entitled to
reimbursement of costs, if any, incurred inn the course of rendering such
assistance to the extent mutually agreed between the competent authorities of the
two States.4. Nothing in this
article shall be construed as imposing on either Contracting State the
obligation to carry out administrative measures of a different nature from
those used in the collection of its own taxes or those which would be contrary
to its public policy.Article28DIPLOMATIC
AGENTS AND CONSULAR OFFICERSNothing
in this Convention shall affect the fiscal privileges of diplomatic agents or
consular officers under the general rules of international law or under the
provisions of special agreements.Article
29ENTRY
INTO FORCE1. The Contracting
States shall notify each other in writing, through diplomatic channels, of the
procedures required by the respective laws for the entry into force of this
Convention.2. This Convention shall
enter into force thirty days after the receipt of the later of the
notifications referred to in paragraph 1 of this article.3. The provisions of
this Convention shall have effect:a. n India, in respect
of income arising in any fiscal year beginning on or after the first day of
April next following the calendar year in which the Convention enters into
force, andb. in Jordan, in respect
of income arising in any fiscal year beginning on or after the first day of
January next following the calendar year in which the Convention enters into
force.Article
30TERMINATIONThis
Convention shall remain in force indefinitely until terminated by a Contracting
State. Either Contracting State may terminate this Convention, through
diplomatic channels, by giving notice of termination at least six months before
the end of any calendar year beginning after the expiration of five years from
the date for entry into force of the Convention. In such event, this Convention
shall cease to have effect:a. in India, in respect
of income arising in any previous year on or after the first day of April next
following the calendar year in which the notice of termination is given;b. in Jordan, in respect
of income arising in any previous year on or after the first day of January
next following the calendar year in which the notice of termination is given.In
WITNESS WHEREOF the undersigned, being duly authorized thereto, have signed
this Convention.DONE
in duplicate at New Delhi, this the twentieth day of April 1999, in the Arabic,
Hindi and English languages, all three texts being equally authentic. In case
of divergence between the texts, the English text shall be the operative one.For
the Government of the Republic of India........................................For
the Government of Hashemite Kingdom of Jordan.
.......................................