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DTAA Between India And Ethiopia


Agreement for avoidance of double taxation of income of enterprises operating aircraft with Ethiopia

Whereas the Government of India and the Provisional Military Government of Socialist Ethiopia have concluded an Agreement, as set out in the Annexure hereto, for the avoidance of double taxation of income of enterprises operating aircraft.

And whereas all the requirements have been completed in Ethiopia and India as are necessary to give the said Agreement the force of law in Ethiopia and India respectively, as required by paragraph (1) of article 3 of the said Agreement.

And whereas the letters to this effect have been exchanged between the said two Governments, as required by paragraph (1) of article 3 of the said Agreement.

Now, therefore, in exercise of the powers conferred by 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 Agreement shall be given effect to in the Union of India.

Notification : No. GSR 8(E), dated 4-1-1978 as corrected by Notification No. GSR 159(E), dated 2-3-1978.

TEXT OF ANNEXED AGREEMENT, DATED 25-11-1976

The Government of India and the Government of Ethiopia desiring to conclude an Agreement for the avoidance of double taxation of income of enterprises operating aircraft chargeable to tax in the said countries in accordance with their respective laws, have agreed as follows :



ARTICLE 1 - 1. In this Agreement, unless the context otherwise requires,—

(a)  the term “Ethiopia” means the territory of Ethiopia and the various islands forming part of Ethiopia, and includes the territorial sea and any other marine areas adjacent thereto, including their sea bed and sub-soil, over the resources of which Ethiopia has, or may hereinafter have, sovereign rights in accordance with international law.

(b)  the term “India” means the territory of India and includes the territorial sea and any other marine areas adjacent thereto, including their sea bed and sub-soil, over the resources of which India has, or may hereinafter have sovereign rights in accordance with international law.

(c)  the terms “a Contracting State” and “the other Contracting State” mean Ethiopia or India, as the context requires.

(d)  the term “enterprise of a Contracting State” means—

(i)  an airline designated by the Government of that State in pursuance of the Agreement dated 3rd August, 1967 (as amended or revised from time to time) between the Government of India and the Government of Ethiopia relating to air services; or

(ii)  an airline which is authorised by the Government of that State by a general or special arrangement between the two Contracting States to operate chartered flights between or beyond their territories.

(e)  the term “international traffic” means any transport by an aircraft operated by an enterprise of a Contracting State, except when the aircraft is operated solely between places in the other Contracting State; and

(f)  the expression “operation of aircraft” means a business of transportation by air of persons, livestock, goods or mail, carried on by the owners or lessees or charterers of aircraft, including the sale of tickets for such transportation on behalf of other enterprises and any other activity directly connected with such transportation.

2. In the application of the provisions of this Agreement by one of the Contracting States, any term used but not defined herein shall, unless the context otherwise requires, have the meaning which it has under the laws in force in that State relating to the taxes which are the subject of this Agreement.

ARTICLE 2 - 1. Under this Agreement income derived by an enterprise of a Contracting State from the operation of aircraft an international traffic shall, on the principle of reciprocity, be exempt from tax in the other Contracting State.

2. Paragraph (1) shall also apply in respect of participations in a pool, a joint venture or in any other similar arrangement regarding air transport.

3. For the purpose of paragraph (1), interest on funds directly connected with the operation of aircraft shall be regarded as income from the operation of such aircraft.

4. For the purpose of this article, the term “tax” shall mean income taxes, and any other taxes, dues and levies on income which are imposed or may hereafter be imposed on behalf of each Contracting State or of its political sub-divisions or local authorities, irrespective of the manner in which they are imposed.

ARTICLE 3 - 1. This Agreement shall be proved in accordance with the laws and practice in force in each of the Contracting States. It shall enter into force on the date of the exchange of letters certifying that the proper procedure was fulfilled in each Contracting State. The exchange of letters shall take place at Addis Ababa as soon as possible.

2. This Agreement shall have effect—

(a)  in Ethiopia, in respect of income derived from the operation of aircraft in international traffic after 1st July, 1966.

(b)  in India, in respect of income derived from the operation of aircraft in international traffic after 1st July, 1966.


ARTICLE 4 - This Agreement shall continue in effect indefinitely but may be terminated by either of the Contracting States with a written notice of six months. In such event, the Agreement shall cease to be effective in respect of income derived from operation of aircraft in international traffic after the 1st day of January next following the date on which the said period of six months expires.

IN WITNESS WHEREOF the undersigned, duly authorised thereto, have signed the present Agreement.
DONE in duplicate at New Delhi this 25th day of November, 1976, in the Amharic, English and Hindi languages, all the texts being equally authentic, except that in the case of divergence of interpretation the English text shall prevail.


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