| The Tax Publishers2020 TaxPub(DT) 2288 (Del-Trib) : (2020) 079 ITR (Trib) 0222 INCOME TAX ACT, 1961
Section 90
As evident from definition clause of fees for technical services under Article 13(4) of Indo-UK DTAA, management services are excluded, however, no document was produced by non-resident assessee in relation to actual services rendered. Accordingly, issue was remanded back to AO for deciding afresh, with direction to assessee to furnish all the necessary documentary evidences in support of the services rendered by assessee to Indian entity including correspondence in respect of services provided.
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Double taxation relief - Agreement between India and UK - Management fee from Indian entity - Non-resident pleading management fee to be outside from the purview of fee for technical services, however, without providing supportive evidence
Assessee based at France received management fee from Indian entity for providing various functional and management supports. AO held the same as Fees for Technical Services (FTS) under article 13 of DTAA between India-France read with protocol to DTAA. Assessee relied upon restricted scope of Article 13 of Indo-UK, DTAA [since, UK is an OECD Member and Indo-UK DTAA has been entered into on 26-10-1993 (i.e. after 1-9-1989)], wherein scope of 'Fees for Technical Services' is more restricted. Revenue's case was that assessee only submitted a copy of agreement and no other document was submitted. Held: As evident from definition clause of fees for technical services under Article 13(4) of Indo-UK DTAA, management services are excluded. However, assessee had not provided entire correspondence regarding services rendered by assessee to Indian entity and in absence of which AO decided all the three issues on the basis of agreement only, i.e., firstly, whether services were purely managerial or falling under technical/consultancy services; secondly, services were ancillary and subsidiary to application or enjoyment of right, property, information and thirdly, services made available technical knowledge, experience, skill, know-how, etc. No other document was produced by assessee in relation to actual services rendered. Accordingly, issue was remanded back to AO for deciding afresh, with direction to assessee to furnish all the necessary documentary evidences in support of the services rendered by assessee to Indian entity, including correspondence in respect of services provided.
REFERRED :
FAVOUR : Matter remanded.
A.Y. : 2011-12
INCOME TAX ACT, 1961
Section 9(1)(vii)
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