Make-available test under the India-USA DTAA determines when research and coordination receipts qualify as fees for included services.

Receipts under the India-USA DTAA are taxable as fees for included services only where technical or consultancy services make available technical knowledge, experience, skill, know-how, processes, or a technical plan or design. Industrial Liaison Program receipts were treated as relationship-building and information-access activities and were not taxable as such. Sponsorship assignment receipts were found to involve research outputs and intellectual property arrangements that satisfied the make-available requirement, so taxation was upheld. Coordination or consortium membership receipts were limited to hosting, administration, and facilitation and were not taxable as fees for included services. TDS credit was left for verification by the Assessing Officer and to be granted in accordance with law.

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Issues: (i) Whether receipts from the Industrial Liaison Program constituted fees for included services under the India-USA DTAA; (ii) Whether receipts from sponsorship assignments constituted fees for included services under the India-USA DTAA; (iii) Whether receipts from coordination or consortium membership constituted fees for included services under the India-USA DTAA; (iv) Whether credit of tax deducted at source was to be granted.

Issue (i): Whether receipts from the Industrial Liaison Program constituted fees for included services under the India-USA DTAA.

Analysis: The program was found to be essentially a relationship-building and information-access arrangement in which corporates were introduced to faculty, researchers, and ongoing work. The services did not amount to technical or consultancy services that made available technical knowledge, experience, skill, know-how, or a technical plan or design to the participants.

Conclusion: The receipts from the Industrial Liaison Program did not constitute fees for included services and were held not taxable as such.

Issue (ii): Whether receipts from sponsorship assignments constituted fees for included services under the India-USA DTAA.

Analysis: The sponsorship research was undertaken for specific sponsors, with research outputs, reports, and intellectual property arrangements showing that the sponsors received the benefit of research-generated technical knowledge and designs. The arrangement was held to go beyond mere reimbursement of cost and to satisfy the make-available requirement.

Conclusion: The receipts from sponsorship assignments constituted fees for included services and the addition was upheld.

Issue (iii): Whether receipts from coordination or consortium membership constituted fees for included services under the India-USA DTAA.

Analysis: The role under the consortium arrangements was only to act as host and coordinator, provide administrative support, and facilitate access and dissemination of research among members. No technical service, technical plan, or know-how was found to have been made available to the members.

Conclusion: The receipts from coordination or consortium membership did not constitute fees for included services and the addition was directed to be deleted.

Issue (iv): Whether credit of tax deducted at source was to be granted.

Analysis: The claim required verification from the assessment records and could not be straightaway allowed on the existing material.

Conclusion: The Assessing Officer was directed to verify and grant the credit in accordance with law.

Final Conclusion: The decision grants relief on the Industrial Liaison Program and consortium membership receipts, upholds taxation of sponsorship receipts, and restores the TDS credit issue for verification, leaving the interest consequences to be recomputed accordingly.

Ratio Decidendi: Under Article 12(4) of the India-USA DTAA, receipts are taxable as fees for included services only when the services rendered are technical or consultancy services that make available technical knowledge, experience, skill, know-how, processes, or a technical plan or design to the recipient.

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