The Delhi High Court has ruled that India's federal tax authority can only apply a 5 per cent withholding tax to dividend income paid by Indian subsidiaries to a Dutch parent. The tax rate cannot be higher than this because the ‘most favoured nation’ clause in the two countries’ tax treaty requires India to match the 5 per cent withholding tax rate it has agreed with some other countries, said the Court.
News Source：【EY 2021/08/29】