Govt dragged to court over India-Cyprus DTAA benefits suspension

After India suspended the benefits of the India-Cyprus Double Taxation Avoidance Agreement (DTAA), the government was drawn to the Supreme Court on Monday by three companies with the claim that the parliament does not have the right to override bilateral treaties.The companies also claim that suspensions of benefits are invalid.  The SC has agreed to hear the petition. It has also given a notice to the government to give clarity on its position to make such decisions with respect to the DTAA.The next date of hearing is July 5.DTAA was inked in 1994 and was suspended in November 2013 by India. Failure to share information with Indian authorities was the main reason for suspension. Post the DTAA suspension, money coming in from Cyprus is liable to pay 30 percent withholding tax.