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2023 (7) TMI 165 - AT - Income TaxFees for technical services (FTS) - receipts from rendition of certain services to its Indian subsidiary - assessee has not offered them to tax claiming that they are not taxable in India - ‘make available’ condition as per Article 13(4)(c) of India- UK DTAA - HELD THAT:- As most of the services rendered are routine management support services - some of the services like implementation of ERP patches, identify indirect tax issue that could arise on sourcing from India for a global project, guidance sought by Indian subsidiary on the terms and conditions to be proposed to one of its customer and preparation of global guidelines for use of power conversion entities, advice regarding increase the use of software in regular activities to increase the productivity, assistance given in opening the supplier code in their SAP etc., may fall within the ambit of either technical or consultancy services. Such services have to be specifically identified keeping in view the definition of FTS under Article 13(4) of India-UK DTAA. In the facts of the present case, the departmental authorities have not carried out that exercise before concluding that the entire variety of services rendered by the assessee comes within the sweep of technical or consultancy services. This, in our view, is unsustainable. Though, the departmental authorities have alleged that the make available condition stands satisfied, however, no material has been brought on record to support such finding. As discussed earlier, the burden is entirely on the Revenue to prove that rendition of services by the assessee has made available technical knowledge, knowhow, skill etc. to the service recipient so as to enable the service recipient to utilize such technical knowledge, knowhow, skill etc. independently in future without the aid and assistance of the assessee. Thus, in our view, the Revenue having failed to demonstrate the aforesaid aspect through cogent evidence, it has to be held that the make available condition under Article 13(4)(c) of India-UK treaty is not fulfilled. Thus we hold that the amount received by the assessee from Indian subsidiary towards rendition of various services do not qualify as FTS under Article 13(4) to India-UK DTAA read with India-France DTAA. Decided in favour of assessee.
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