Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2022 (10) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (10) TMI 657 - AT - Income TaxIncome deemed to accrue or arise in India - taxability of management fees received by the assessee as fees for technical services under the provisions of the Act as well as under India Singapore Double Taxation Avoidance Agreement (‘DTAA’) - HELD THAT:- We find that the coordinate bench of the Tribunal in assessee’s own case [2022 (7) TMI 1330 - ITAT MUMBAI] decided similar issue in favour of assessee “make available‟ clause in the Indo-Singapore tax treaty cannot be invoked on the facts of the present case- as no case is even made out by the revenue that as a result of rendition of these services to the Indian entity, there is any transfer of skill or technology. It is not a question of, as the learned DRP put it, enriching “the service recipient, making him wiser to face similar challenges in future on his own and acquiring the skills to deal with these issues”, but the test is whether the rendition of these services per se enables the recipient to provide the similar services, without recourse to the service provider, in future. An incidental benefit or enrichment which may add to the capabilities is not sufficient; the critical factor triggering the taxability in the source jurisdiction is the transfer of skills. Once the taxability fails in terms of the treaty provisions, there is no occasion to refer to the provisions of the Income Tax Act, 1961, as in terms of Section 90(2), “where the Central Government has entered into an agreement with the Government of any country outside India or specified territory outside India, as the case may be, under sub-section (1) for granting relief of tax, or as the case may be, avoidance of double taxation, then, in relation to the assessee to whom such agreement applies, the provisions of this Act shall apply to the extent they are more beneficial to that assessee. - Decided in favour of assessee.
|