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| The Tax Publishers2023 TaxPub(DT) 783 (Del-Trib) INCOME TAX ACT, 1961
Section 90
Where assessee having provided business support services to its Indian Group entity, not made available technical knowledge, know-how, skill, etc., to recipient of services, which would have enabled recipient of such services to utilize it independently without the aid and assistance of assessee consideration received by assessee towards such services could not be treated as FTS under India-Netherlands DTAA.
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Double taxation relief - Agreement between India and Netherlands - Fees for technical services (FTS) - Payment received towards managerial services
Assessee based at Netherlands, provided business support services to its Indian Group entity and received payment. AO taxed the same as fees for technical services (FTS) under article 12(5) of the India-Netherlands [DTAA]. Held: Services rendered by assessee were : Engineering Services (Application Engineering and Technical Support/CAD/CAM Design); Financial Administration Services, including Treasury; HR Services, including benefits and related services; Environmental Health and Safety; IT Services; Management, Marketing, Legal Services; and Tax Services; Supply Chain Management Services, including purchasing logistics and procurement; & Quality Management Services by rendering the services, assessee had not made available technical knowledge, know-how, skill, etc., to the recipient of services, which would have enabled recipient of such services to utilize it independently without the aid and assistance of assessee. Thus, payment received by assessee could not be treated as FTS under India-Netherlands DTAA.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2014-15
IN THE ITAT, DELHI BENCH: D NEW DELHI
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