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2022 (9) TMI 1447 - AT - Income TaxIncome taxable in India - fees for technical services (FTS) - services in the nature of support services - importing of “make available” test from the India UK tax treaty read with the protocol - whether support services rendered by the assessee are excluded from the ambit of FTS since the “make available” clause under the India- France DTAA even after amendment notification So No. 650 (E). dated 10.07.2000? - as per CIT-A support services rendered by the assessee are excluded from the ambit of FTS - HELD THAT:- In our understanding of the law the protocol to a tax treaty is an indispensable part of a tax treaty with the same binding force as the main clauses of the tax treaty. In our considered opinion the provisions of the tax treaty are, therefore, required to be read with the protocol and are subject to the provisions contained in such protocol without there being a need of a separate notification for enforcing the provisions of the protocol, this has been settled by the decision of Steria (India) Ltd [2016 (8) TMI 166 - DELHI HIGH COURT] The term FTS has a more restrictive scope in so far as the absence of the term “managerial” and further existence of the “make available” condition are embedded therein. In our understanding under the India UK tax treaty for a payment to quality as FTS both the following conditions need to be cumulative satisfied : (i) The services need to be “technical” or “consultancy” in nature. (ii) The services need to make available technical knowledge, experience, skill, know-how or processes, which enables the persons acquiring the services to apply the technology contained therein. No infirmity in the findings of the CIT(A) which need interference. Decided against revneue. CIT(A) has admitted additional evidences in violation of rule 46 A of the Income Tax Rules 1962 - We do not find any merit in this contention of the revenue because the CIT(A) invoking the powers conferred upon him u/s. 250 (4) called for certain information/ documents and based his findings on such information / documents. In the light of section 254 (4) of the Act the CIT(A) is free to conduct the enquiry to dispose of the appeal as he deems fit. We, therefore, decline to interfere with the findings of the CIT(A). The appeal filed by the revenue is dismissed.
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