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2022 (1) TMI 1032 - AT - Income TaxIncome accrues or arises in India - services to MTR foods Private Limited who is located outside India - Secondment charges paid in respect of the professional services rendered - classification as FTS - made available by non resident Assessee to MTR Foods in India - India Singapore DTAA - Taxability of receipts received by assessee from M/s. MTR Foods Pvt. Ltd., as FTS under section 9(1)(vii) - HELD THAT:- Only technical and consultancy services are covered by Article 12(4) as either (a) are ancillary and subsidiary to the application or enjoyment of the right, property or information referred to in Article 12(3), or (b) 'make available' technical knowledge, experience, skill know-how etc. In the present case, only clause 12(4)(b) is applicable because there was no right, property or information that was transferred. The case of the Revenue therefore hinges on the applicability of Article 12(4)(b) which applies to rendering of only such technical or consultancy services as 'make available' technical knowledge, experience, skill or know-how etc. Taxability of an income under Article 12(4)(b), not only the payment should be in consideration for rendering of technical or consultancy services, but in addition to the payment being consideration for rendering of technical services., the services so rendered should also be such that 'make available' technical knowledge, experience, skill, know-how, or processes, or consist of the development and transfer of a technical plan or technical design. Hon'ble Mumbai Tribunal in Raymond's case [2002 (4) TMI 891 - ITAT MUMBAI] also held that rendering of technical services cannot be equated with making available the technical services. We are of the view that, nothing is made available by non resident Assessee to MTR Foods in India. Accordingly the services rendered by the non resident assessee to MTR Foods are not taxable as per India Singapore DTAA. Since the non resident assessee do not have a permanent establishment in India, the income so arising cannot be taxed under Article 7 as 'business profits' either. - Decided in favour of assessee.
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