During the income year 2020-2021, Blue Mountain Co Ltd was a company resident in Mauritius. It carried on business in Mauritius. It also had a permanent establishment in China. Blue Mountain Co Ltd had also invested in the share capital of Belmore Co Ltd, a company resident in Sweden, and in the share capital of Canasuc Co Ltd, a company resident in Mauritius. Blue Mountain Co Ltd was also the owner of a building in Bangladesh from which rental was derived. Given that Blue Mountain Co Ltd met certain conditions under the law of Bangladesh, the said income was exempt from income taxation in Bangladesh. The various incomes derived by Blue Mountain Co Ltd were as follows for the income year 2021-2021: 1. Income derived from business carried on in Mauritius: Rs2,000,000. 2. Income attributable to the permanent establishment in China: Rs5,000,000. It is assumed that it is also the real income derived by Blue Mountain Co Ltd in China. 3. Blue Mountain Co Ltd obtained Rs50,000 as dividend from Belmore Co Ltd, net of income tax. 4. Rental income from Bangladesh amounted to Rs1,500,000. 5. Dividends from Canasuc Co Ltd amounted to Rs200,000. The following data is also available: 1. Mauritius had signed Double Taxation Agreements with China, Sweden and Bangladesh. 2. The applicable corporate income tax rate in China is assumed to be 20 percent. 3. The withholding tax rate in Sweden applicable on dividends is 15 percent. 4. The tax rate applicable on rental income in Bangladesh is 10 percent. REQUIRED (a) Calculate the tax liability of Blue Mountain Co Ltd for the income year 2020- 2021. [30 marks] (b) Explain three reasons for which States enter into Double Taxation Agreements.