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of <h1>Tribunal overturns decision, directs reassessment of expenses as technical services fees.</h1> <h3>Foseco International Limited Versus ADCIT-3 (2), Mumbai</h3> Foseco International Limited Versus ADCIT-3 (2), Mumbai - TMI Issues:Appeal against order of CIT(A) for assessment years 2006-07 to 2008-09 regarding addition of reimbursement of expenses as fees for technical services.Analysis:The appeals pertained to the addition of reimbursement of expenses as fees for technical services by the Assessing Officer (AO). The assessee, a UK-based company engaged in the metallurgical industry, received sums in A.Y. 2008-09 and claimed reimbursement of expenses not offered to tax. The AO considered the reimbursement as fees for technical services based on judicial precedents. The CIT(A) upheld the AO's action. The assessee contended that the reimbursement involved no profit element, citing various judicial precedents. The assessee argued that even if considered technical service fee, it did not meet the 'make available' concept in the India-UK DTAA. The breakup of expenses was detailed, including Lotus Note Charges and other expenses. The AO questioned the lack of agreement evidence and nature of invoice issued. The Tribunal found the absence of an agreement crucial in determining the nature of reimbursement. The lower authorities' orders were set aside, directing the AO to re-examine the issue. All appeals were allowed for statistical purposes, restoring them to the AO for fresh consideration.
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