International Tax Regime: Mihir's Comments

In my previous post I had briefly discussed the international tax regime and India's compliance. Subsequently Mihir had posted a very interesting and informative comment. For the benefit of the readers I reproduce the same as a post. Here is the comment:

"the Courts in India have noted the existence of 'international tax law' from time to time. For instance, in CIT v. Vishakapatnam Port Trust 144 ITR 146, the AP High Court observed as far back as in 1983, "In view of the standard O. E. C. D. models which are being used in various countries, a new area of genuine 'international tax law' is now in the process of developing"


However, most of the Indian judiciary's reliance on 'international tax law' is really more of a reliance on decisions of foreign courts. For instance, the Pune Bench of the Tribunal has observed in Daimler Chrysler, "Undoubtedly, judicial precedents from judicial bodies abroad cannot have any binding value, but these precedents surely deserve due and careful consideration. This is a truly two way traffic now and not only that Indian judicial forums are taking note of and following the judicial precedents abroad, even the foreign judicial bodies are taking due note of judicial precedents from India… On the subject of using foreign judgments to achieve uniformity of interpretation, Lord Denning, in the case of Corocraft, said: 'If such be the view of the American courts, we surely should take the same view. This convention should be given the same meaning throughout all the countries who were parties to it'… The importance of uniformity of interpretation of expressions which are used in global treaty networks can thus hardly be overemphasized"

Arguably, perhaps, the last sentence of the quote above refers to customary international law