Viva Voice – 3rd Year

13 November 2021

Labour Law

Research objectives:

 To understand the implication of ILO’s Social Security (Minimum Standards)

Convention, 1952 on the Social Security Code, 2020.
 To analyse the recommendations of the Parliamentary Standing Committee that
were not introduced in the final draft.
 To analyse the certain ambiguous provisions and missing definitions which will
curtail the proper implementation of the Code.

Social Security (Minimum Standards) Convention, 19521. The ILO had

proposed this Convention as a response to the Declaration of Philadelphia in the year
1944, where it was first recognised the Right to Social Security as a human right of
workers, this convention was considered to be the first step in the direction of creating
a separate branch of International Law called the International Social Security Law.
Since then, the ILO has initiated 31 conventions and 24 recommendations that
propagate the ideas of social security, still the Social Security (Minimum Standards)
Convention, 1952 is considered to be the flagship of conventions in this regard.
Even though India is not a signatory to the Social Security (Minimum
Standards) Convention, some of the legislations passed within the nation take up some
inspiration from this convention and propagate policies that the ILO has proposed,
some of the legislations include,

 Employee Compensation Act, 1923

 Employee's State Insurance Act, 1948
 Employees' Provident Funds and Misc. Provisions Act, 1952
 Maternity Benefit Act, 1961
 Unorganized Workers' Act, 2008

1
International Labour Organisation, Setting Social Security Standards in a Global Society (2008).
 These legislation directly or indirectly corelates with the components of social
security that are numerated in the ILO convention, the incorporation of all these
legislations and other similar legislations to the Social Security Code, 2020 makes this
code the champion of Social Security (Minimum Standards) Convention in India.
Even the ILO has recognised this legislation as a legislation that is propagating
its convention and has supported the creation of the legislation. The ILO has
categorised this legislation as a legislation on the subject of Social Security (general
Standards).

The draft presented before the Parliament was a Comprehensive legislation that
aimed to regulate and legislate some of the inadequately covered Social security
components.
One of the important aim of the code is to ensure the implementation Social
security for unorganised labourers. In this regard The Code is an improvement to the
previously existing independent legislation as it consolidates all offices and
procedures into one massive infrastructure for enabling easy accesses to the workers.
The social security code directs the government to create a National Security Board
which will recommends the government to prepare schemes that are best suited for the
target groups like the workers from the unorganised sectors, interstate migrants,
people employed in Asha and Anganwadi.
The Parliamentary Standing Committee after going through the draft gave
various recommendation on how the lofty goals of the Code can be focused on. The
committee recommended that providing a structural framework within the Social
Security can help achieve the goals within the estimated time limits 2. Likewise, the
PSC made several recommendation like reiterating certain definitions in the code to
expand the applicability of the scope of the code, creating separate funds and create
insurance policies for workers engaged in different levels of employment. After
getting the recommendations and approval of the Parliamentary Standing Committee
and the national commission on Labour, the Code was passed on 28 September 2020
after gaining the presidential assent.
While many of the recommendations of the Parliamentary Standing Committee
was taken in to consideration, some of the recommendations were not implemented
into the Code. Some of the recommendations that were not taken into account act had
implications on the constitutionality of the code itself.

2
The Code on Social Security, 2019, PRS Legislative Research (2021), https://prsindia.org/billtrack/the-code-
on-social-security-2019 (last visited Aug 26, 2021).
 The free hand given to the government through Section 152 of SSC to limit or
broaden the scope of the laws are pointing the other direction. This pull push situation
between the pros and cons of this legislation has brought to the table questions that are
needed to be answered. In the advent of issues that came up during the Pandemic
when, UP suspended all labour laws, Section 152 of the Code seems suspicious , this
section provides the Central Government the express power to amend any part of the
schedules in the code through executive orders and notification.
Factory in section 2(2) of the Code the term factory is used to define factories
using power and employing ten or more employees and those not employing the
power and employing 20 or more employees while this is defined as such, the same
terms defined differently in other legislations like the Occupational Safety and Health
and Working Conditions Code, 2020 . This inconsistency between the Code will lead
to breakdown of provision as a certain subject qualifying under one code may not be
accepted by the other codes. Likewise, the term employee is defined throughout the
SSC and it does not in the OSHWCC where the term worker is used and is defined
 Digitalisation of the process behind the Social Security Code:
In the process of making the benefits derived from the code to be
expanded, the underlying problem has been neglected. Most of the workers
from the unorganised sector do not possess the necessary digital literacy nor do
they have connectivity to use them. This instead of making the process easier
can make them a prey to the middleman. Also, digitalisation of the procedures
may make the schemes and policies lesser known to people.

 Lack of Co-ordination between the States;

While intending to make a generalised legislation to target the moving
population like the migrant workers, the co-operation of the states is of utmost
importance3. These workers are scattered all over the nation and are in a
constant state of movement. Also, there are problems related to overlapping
jurisdiction when it comes to regulating these social security measures.
Therefore, regulating the difference between the states are not thought after in
these provisions.

 Maternity Benefits for women in Unorganised sector;

The main talking point for this Code is that it has widened its scope to
include the unorganised sector within its Social Security Schemes 4, but one of
the main and important Social Security component that is yet to be added to
this list is the Maternity Benefits for women employed in Unorganised
labourer. It is yet to be achieved.
3
Shyam Sundar & Ragul SureshSakpal, Social Security Code: Another Historic Opportunity Missed!, (2020).
4
Evaluating The Code On Social Security, 2020 - Employment and HR - India, Mondaq (2021),
 Employees Provident Fund and Gratuity Payment:
Like in case of the maternity benefits for women employed in
Unorganised sector, the employees provident and gratuity payment are yet to
be initiated for personnel’s working in the informal workers5, the existing
system in not robust enough to handle these inclusions. the code needs to
implement newer method that are needed to encompass them.

 Absence of Unemployment Allowance

Unemployment Allowance is an important component of the Social
security itself; it is a component that even the ILO propagates in its
convention6. The absence of the Unemployment Allowance is one of the major
failure of the Social Security Code. And another important area that the Social
Security Code failed to look into is the problem of unemployment in India,
with the ongoing pandemic the unemployment rate on the increase and as a
legislation passed during its play is disheartening to look into.
These are some of the misgivings under the Social Security Code, while
these are obvious it is important to know that while making a comprehensive
and consolidated law there are bound to be certain that that were forgotten
among the crown. We can hope that these provisions and the vagueness of
certain provision are added or amended into the Code to better facilitate the
Labour community.

The Social Security Code, 2020 is an ambitious legislation that has yet to reach
its full capacity, yet it has taken steps in the right direction to provide Social Security
to categories of people who most require them. This code to be looks like a miniature
version of the ILO”S Social Security (Minimum Standards) convention as it holds
within itself all the components of Social security as propounded by the convention.
While the goals are ambitious the procedures and methods are needed to be
altered to suit the work. This legislation is a work in progress that will certainly
achieve its objective with the right amendments and additions.

5
Shyam Sundar & Ragul SureshSakpal, Social Security Code: Another Historic Opportunity Missed!, (2020).
6
New labour code on Social Security has not been able to address overlapping definitions, Legal (2021),
 Corporate Law

Research Questions:

 Why do the companies prefer Preferential Shares than to Equity shares?

 What are the Advantages/Benefits of Preferential Shares when compared to
Equity Shares?
 What are the occasions when these Preferential Shares are misused?

Research Objectives:

 To understand the importance of Preferential Shares as an alternate source of

Capital for the company.
 To Analyse the Advantages the Preferential Shares, hold when compared with
Equity Shares

Preferential Allotment of Shares is one of the fastest way a company can raise
capital, normally intended as an long-term financing instrument. Unlike Equity
Shares, the Preferential shares are not floated in the market. Rather it is offered to a set
of select potential investors privately. This preferential basis of allotment of shares
had earned for itself the term preferential allotment of share. For a company to issue
preferential shares it must follow the rules and regulations put up by the SEBI and is
issued under section 62 (1)(c) of the Companies Act, 2013 .
One of the main reasons for issuing these kinds of shares is to enable certain
investors or shareholders who aren’t able to buy the shares in bulk due to the existing
market conditions
Even though these are shares issued by the company they do not hold the same
value as an Equity Share, Unlike an Equity share which provides the investor with
voting rights, these preferential shares do not provide voting rights to the owner.
Through this the company is able to raise capital through instrument an
instrument that does not warrant for Voting rights like Equity Shares or an
compulsory return like Debenture while maintain the positives of both The only relief
the Preferential Shareholders have over the Equity shareholders is that in case of
Liquidation of the Company the Preferential Shareholders have rights over the Equity
Shareholders in gain their capital.

Also, the fact that these Preferential Shares are normally issued in bulk ensures
a large flow of capital to the company at lower level of commitment for the Company
makes it profitable and preferrable for the company.
 Therefore, the process of raising capital through preferential Shares are much
faster that other instruments since this does not require for the process of floating this
share nor does it have to wait for the investors because they investor are already
available. This seriously increases the efficiency of raising capital all the while
keeping the commitment of the companies to a minimum.

Preference Shares when compared with Equity Shares and Debentures hold
characteristics that are beneficial to both the Investors and the Company in Different
ways. In Fact, shares allotted through preferential allotment shares several of its
characteristics from both Equity Shares and Debentures. It is an amalgam of positive
traits taken from Equity Shares and Debentures.

Characteristics of Preferential Shares:

1. Like Equity Shares, Preferential Share gets their return only when the
Company gains profit. Unlike Debentures which warrant for interest as return
even if the company is not able to turn Profit.
2. Like Debentures, Preferential Shares have a fixed rate of return, which can
achieved even when the company defaults by taking up a suit.
3. Like Debentures, Preferential Shareholders too don’t get voting rights, whereas
Equity Shareholders can.
4. Unlike Equity Shares, the Company can easily redeem both Debentures and
Preferential Shares.

Attracts Investment:

Preferential Shares because of its Shared Characteristic attract Investors who are
cautious on their moves and investments. Being able to gain a regular and fixed return
from their investment makes Preferential Shares Amiable to them.

Independence of the Company:

Since, Preferential Shareholders do not possess voting rights the company does
not lose its control over its functions all the while raising capital. This is preferrable to
the Equity Shareholders too since their control over the company is not being diluted
by issuing more Equity Shares.

Trading on Equity:

Since the Return Rates on Preferential Shares are prefixed, the company at times of
excess profits an provide the benefits of trading on equity to the equity shareholders.
This ensures the entourage of the Equity Shareholders.
Freedom on Assets:

Unlike Debentures, which attach assets of the company as security for the
money loaned, Preferential Shares do not attach the assets of the Company as security
rather they take up the characteristic of an Equity Share and depend only on the
dividends for the return. But they gain a leg over Equity Shareholders at the of
liquidating the company. Along with debenture holders Preferential Shareholders get
compensated before Equity Shareholders.

While in its basic nature, Preferential Allotment of Share is an instrument used

for raising share for the Companies. In fact, the areas where the instrument can be
misused are relatively low when compared with other instruments since there are no
need for brokers or middleman this method is more or less airtight connect between
the company and the investors. But, Like all other instruments used to raise shares
Preferential Shares to share the same rules and restriction on how the raised Capital
will be utilised.

They all flow into the same capital pool utilised by the company for its
functioning. Even though that maybe the case there are still areas where the funds
acquired through Preferential shares can be misused.

Recently , SEBI in its investigation has cornered a case where funds raised from
the preferential issue were deviated and mis-utilised for unstated purposes different
from the objectives mentioned in the offer letter. Similar concerns were raised in the
case of M/s. Achal Investments Ltd , which resulted in the business being suspended
from the securities market for five years with severe penalties levied on the company
 Law of Evidence:

A Critical Analysis of Section 85 of the Evidence Act, Presumptions

as to powers-of-attorney

Research Questions:

The research question that the researcher intends to pursue are

 Where does the Burden of Proof lie while proving the presence a Power of
Attorney, when the court presumes it to be true?
 What is the need for the Power of attorney to be Authenticated by a Notary
Advocate?
 Can a Power of Attorney attested by a foreign institution hold any value in an
Indian Court of Law?
 How can a document of Power of Attorney be rebutted in a Court of law?

Research Objectives:

 To understand the importance of Power of Attorney as an essential document in

a court of law, such that the court presumes strongly to be true.
 To analyse the Section along with the Power of Attorney Act, 1882 to infer the
importance of authenticating the document.
 To Study the process and steps followed to rebut a document pertaining to a
power of Attorney.

1. Where does the Burden of Proof lie while proving the presence a Power of
Attorney, when the court presumes it to be true?

These presumptions are ascertained based on the probability and substantial

value that the fact possess or when such facts is a consequence of certain acts that hold
substantial value in a court of law.
 This is established by the Act under Section 114 where it states that the “ the
court may presume the existence of any fact , that the court thinks could have likely
happened as a consequence / course of natural events like human conduct and public
and private business.

One of the basic classification of presumption is the difference between,

Presumption of Facts and Presumption of Law:

The difference between Presumption of Facts and Presumption of Law is

mainly on the validity they hold in a Court of Law. When a presumption of fact is
based on integrants like Human Experience, theories proposed by Science and the law
of Nature, the presumption of Law is based on the provisions, Judicial Norms and
precedents established by law.

Unlike in Presumptions of Facts, the Presumptions of law is always conclusive

and certain, unless the presumption is rebutted through the established procedures.
This shows the strong hold the Presumption of Law has on the court of law on its
validity7. It is so that the court of law does not have any discretionary power over the
Presumption of Law and are bound to presume such facts as it is.

Section 4 of the Indian Evidence Act defines the different levels of

presumption that the court can make using the provisions under the Act, the section
directly defines three different levels of Presumptions and they are;

 May Presumption

May Presumption is defined under Section 4 (1) of the Act, It is a kind of

presumption where the discretionary power of the court is the strongest, from the term
“ May” itself we can infer a sense of possibility that is dependent on the person in our
case the court making it.

These kinds of presumptions are does not possess strong value by itself in the
eyes of law and are often needed to be supported by other corroborative evidences to
confirm the presumptions. These kinds of presumptions can be rebutted in a court of
law by proving them to be invalid.

Some of the other names that are used to denote these kinds of presumptions
are Natural Presumptions, Permissive Presumptions, rebuttable presumptions or
presumption of Facts.

 Shall Presumption
7
Arora, Himanshu. "Presumption Under Indian Evidence Act, 1872."(2012)
 Shall Presumption is defined under Section 4 (2) of the Act, these
presumptions hold a slightly higher value in the eyes of law when compared to May
presumption, from the term Shall we can infer the stronger assertion that the Act puts
on the court of law to presume such facts.

In this cases the court does not have any discretionary powers to presume such
facts, the act compels the court to presume such facts to be true unless the contrary
can be proved. This Presumption can still be rebutted in a court of law.

Because of the robust and strong compulsion, the Presumption puts on the
Court of Law, these are called the Presumption of Law or Obligatory Presumption.

 Conclusive Presumption / Proof

While the previous two presumption are floating and is not conclusive, this
Conclusive Proof is essentially different, the court in this case neither have
discretionary powers to not take this into account nor can these facts be rebutted in a
court of law. The court does not allow any proofs or evidences that are contrary to the
Presumption. There are only certain sections within the act that propounds this
Presumption and in all these cases they perform an important function. Some
Provision under the Act that propounds Conclusive Presumption are Section 41, 112
and 113 of the Act .

The Hierarchy of Presumption under Section 4 is such that the Conclusive

Proof takes the highest forms of presumption that cannot be rebutted in any case, like
in case of Presumption of Law, next comes the Shall presumption followed by May
presumption both these presumptions can be rebutted but the shall presumption takes
the higher stage as this holds a higher value / obligation on part of the court to take
into account.

Thus, this is the Hierarchy of Presumption as established under section 4 of the

Indian Evidence Act.
Sections 79 – 90 in the act governs the presumptions as to genuineness of Documents,
in this chapter Section 85 deals on the subject matter of Presumptions as to Powers of
Attorney .
Section 85 of the Indian Evidence Act states that
"The Court shall presume that every document purporting to be a power-of-attorney,
and to have been executed before, and authenticated by, a Notary Public, or any Court,
Judge, Magistrate, Indian Consul or Vice-Consul, or representative of the Central
Government, was so executed and authenticate”
From the wordings of the provision, we can understand that this provision is a
shall presumption and holds the attributes accordingly

The facts and documents produced in furtherance of sections is presumed to fulfil

certain Requisites that are established under Section 33 of the India Registration Act,
1908Those requisites that the court presumes are:
The power of attorney must be already existing and the deed for the power of attorney
must be registered and authenticated by any one of the persons authorised to make
such authentication by the provision.

As any deviance from the procedure can make the presumption liable to be rebutted.
Some of the measure taken by the court through its judgements to ensure this are
 The person providing the document for power of attorney must provide an
affidavit that ensures the execution of power of attorney and such submission of
affidavit must be done before a person who is competent to administer a oath.
 The Authentication done by the done by the competent authorities to confirm the
existence of the power of attorney is not just attestation but it establishes that the
particular office has assured the fact of execution of the deed for power of
attorney.
 A power of attorney under section 85 can prove for agency.
 When a power of attorney is neither authenticated nor executed by any person
competent under Section 33 of the Registration Act, then the Presumption as to
Power of Attorney cannot be raised.
2. What is the need for the Power of attorney to be Authenticated by a Notary
Advocate?

It was in the case of Wali Mohammad Choudhary v. Jamal Uddin Choudhary

the power of attorney itself was under disputed. It was in this case the court
established that the process of authentication is not mere attestation but an assurance
given by the competent person authorising the Power of Attorney. He has to ascertain
the facts and person coming to form the power of attorney. It is because of the
weightage behind such document the document for power of attorney holds such high
presumption before the court of law. This presumption holds strong until such
presumption is rebutted in a court of law.

3. Can a Power of Attorney attested by a foreign institution hold any value in an

Indian Court of Law?

It was in the case of Rudnap Export & Import v. Eastern Associates Co it was
established that any power of attorney registered and authenticated by a notary public
in a foreign nation can be presented as a valid document considerable for presumption
under section 85 of the Act, if such documents are verified and authenticated by the
Indian Financial Commission .

4. How can a document of Power of Attorney be rebutted in a Court of law?

In any case where the Document for power of attorney is presented before the court of
law, the opposite party has to merely prove the absence of the authorisation by the
competent party according to section 33 of the act to make the presumption to be
invalid.
This was established by the Kerala High Court in the case of Damodaran Suran v.
Keshavan Meenakshy , where it was established that the rationale behind the
presumption for power of attorney is taken as a shall proof is because of the fact that
the authorisation done by the competent officer is not merely a attestation but an
assurance of the fact itself. It is because of that the document is presumed to be true
and holds a strong view in the view of the court of Law. Therefore, in the absence of
such authorisation the document does not hold any value .
Conclusion;
While we understand that our main aim is to analyse the reason for Section 85
possessing a Shall presumption and how the validity of such document is determined.
In this research we have determined that the document by itself does not hold any
value but the signature of the competent officer as mentioned in Section 33 of the
Indian Registration Act, 1908 giving the authentication to the document adds value to
the document itself. Any unauthenticated document does not hold any value in a court
of law, because the authentication given by any Notary Public is not an attestation but
is an act of assuring the court that the contents of the Document to be true.
 Law of Direct Taxation

A Critical Analysis on the Working of Double Taxation Relief

Provisions in India.

Research Questions:

 How was DTAA first initiated in India and what was the precedent for the

Initiation?

 What is the Mechanics behind the working of DTAA?

 What are the Double Taxation relief Provisions in Income Tax Act and how does

the DTAA affect such Provision?

Research Objectives:

 To Analyse the Initiation of DTA Agreements in India and International Forum.

 To Analyse the Mechanics and working of the Double Taxation Avoidance

Agreements.

 To Understand the relationship between the provisions of the Income Tax Act and

the Double Taxation Avoidance Agreements

 1. How was DTAA first initiated in India and what was the precedent for the

Initiation?

Historically speaking Double Taxation Avoidance Agreements have been in

picture since the late 19th Century, first ever DTAA was executed between the Prussia
and the Austro-Hungarian Empire. In India we must first understand the economic
conditions of India during the early 20th Century. India as a Nation was still under the
clutches of the British Rule and the Economy of the nation was completely
monopolised by the British Government. Therefore, to streamline the process between
trade and taxation between the United Kingdom and its colonies (India) they brought
up several Double Taxation relief Rules. It was in the year 1939 the British
Government enacted the “Income-tax (Double Taxation Relief) (Indian States) Rules”,
this was the first ever DTAA to be implemented in India.

Later after the Independence, India started to enter into DTA Agreements as
per the OECD convention and became one of the non-member economies that has an
working relationships with OECD since 1995. Currently India has a total of 85
effective DTAAs with several world nations. Even though India has been invited as an
member to OECD. India is cautious on its moves since it may send a wrong message
to many of the emerging economies. Even though DTAA in the outlook seems to be a
policy/treaty that is aimed towards clearing issues. Depending on how it is structured
and implemented its effect can vary. A tactically worded residence based taxing
structure can very well demolish the economy of a small or a developing nation. It is
because of the strong role played by these treaties they must be carefully treaded.

 What is the Mechanics behind the working of DTAA?

In simple terms DTAA promotes Foreign Direct Investment and protects the
investors from unreasonable taxation, also it makes sure that all income is taxed in one
place or other. This agreement between the nations ensures both the taxation on
income and non-double taxation on the same income.

In this regard the treaty implements 2 different methods to tax income and
those are the Resident principle and the Source Principle. Both these principal work in
essentially opposite ways to ensure taxing of income. While the Resident Principal
warrants for the income to be taxed in the place of residence of the Assessee, the
Source Principal warrants for the income to be taxed at the source of the income itself.
both these principle have their own positives and short comings too. The conflict
between the implementation of these two have been a major issue while deliberating
on a DTAA policy and has led to various issue like Treaty Shopping which is seen as
a major loss of Income by many governments.

Sometimes when the residents of a particular nation are conducting business

with other nations that have not been in treaty for DTAA, then their country would
automatically grant relief by not collecting any tax from them. This would ensure that
they are not doubly taxed. These kinds of relief are what we say as the Unilateral
relief.

Treaty shopping is the process where companies and individual investors set up
business in nations having favourable tax treaty with the target country. This allows
for these individuals to mask the original flow of income and gain unfair advantage
over the system. Treaty shopping has become a tool for many MNCs and other private
individuals to escape from excessive taxing.

While these are not essentially illegal these lead to very serious loss of income
for countries through loss of tax. These are seen as harmful practices by both the
OECD and the UN because of the high loss of reasonable revenue for the countries .

This Process of Treaty Shopping undermines the objective of the DTAA itself,
DTAA is put up between two nations to provide foe the citizens/residents of the
Respective nations to benefit from trade and escape from unfair burden. But what
these Treaty shopping does is that it potentially transfers all the benefits to the
residents of a third nation who is not a party to the treaty. By this transfer of advantage
from the contracting nations, it potentially transfers all the benefits and tax income to
that nation. This defeats the objective of the treaty itself.

In this process there is also an serious loss of Revenue for the contending
nation. A DTAA is structured in such a way that both the nations benefit from this
treaty. But the interference from the third party tilts the scale and damages the revenue
of the nation who were sacrificing their revenue

 What are the Double Taxation relief Provisions in Income Tax Act and how does

the DTAA affect such Provision?

Income Tax Act, Finance Act and the Double Taxation Avoidance Agreement
are supposed to work in tandem with each other. While the Finance Act is almost
independent from the other two factors. The Income Tax Act and the DTAA are
supposed to go together simultaneously since one contains the provisions for taxing
various income of the Assessee and the other holds the info on what are the incomes
that are needed to be taxed and what are to be not. This is a various tedious job to
synchronise them because of the fact that there are more than 85 active DTAA with
various countries and all must be applicable with the Income Tax Act.

It was in the Finance (No.2) Act, 1991 it was introduced under section 90(2)
that in a situation where India has signed a DTAA agreement with a nation, then
Income Tax Act will apply to individual who are subscribed to such DTAA in such a
way that the Act is beneficial to him.

This was established in the case of Union of India v. Azadi Bachao Andolan
where the Supreme Court established the applicability of Income Tax Act based on
the DTAA signed.

This comes to show that the DTAA holds higher value than the Income Tax
Act due to its Inter-National Nature. The main question here is that Can a person be
taxed under ITA in a year and under DTAA in another.

The other question here would be since the Agreement holds a higher value
than the Act , whether the government can subsequently enact a legislation or
amendment that has an overriding effect on the Agreement. Likewise, there are
various where the agreement and the Act come into Conflict

Some of the basic conflicts include the definition of certain terms and which
will be held over the other. This specific issue was treated by the OECD where Article
3(2) of the OECD model convention states that unless the context otherwise provides,
any term not defined in the treaty shall have the meaning as it has under the law of the
State to which the treaty applies

Findings:

The fact that DTAA is coming into conflict with the Act in various ways also
questions the implementation of the Act. Therefore, the proper relation between the
Act and the Agreement needs to be established to better approach the Agreement.

Also, the fact the DTAA is being misused under the label of Treaty Shopping
and sometimes used to undermine the economy of developing nations also questions
the validity of the Agreement. On the same hand the treaty must also regulate the other
end of the spectrum “ Double Non-Taxation”. There needs to be a proper Universal
guiding mechanism for these Agreements to maintain the Universality of the
Agreement between nations.