Make available test under India-Singapore DTAA: remote software support and training were not fees for technical services.

Receipts from maintenance and training services provided by a Singapore resident to Indian customers were held not taxable as fees for technical services under Article 12 of the India-Singapore DTAA or section 9(1). The services consisted of remote support for software bugs and usage issues, together with basic training for proper software use, but they did not make available technical knowledge, skill, experience or know-how to the customers. The assistance was treated as ancillary support linked to software licensing, and the fact that it was rendered by technical personnel or through remote means did not alter the treaty position. The addition made by the Assessing Officer was deleted.

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Issues: Whether receipts from maintenance services and training services provided by a Singapore resident to Indian customers were taxable in India as fees for technical services under Article 12 of the India-Singapore DTAA and section 9(1) of the Income-tax Act, 1961.

Analysis: The services comprised telephone, email and remote-login support for software bugs and usage issues, along with basic training for proper use of the software. The prior coordinate bench ruling in the assessee's own case held that such support and training did not transfer technical knowledge, skill or expertise in a manner that enabled the Indian customers to apply the technology themselves. The services were held to be ancillary support connected with software licensing, and the mere fact that assistance was rendered through technical personnel or by remote means did not satisfy the treaty requirement of making available technical knowledge, experience, skill or know-how.

Conclusion: The receipts from maintenance services and training services were not taxable as fees for technical services under Article 12 of the India-Singapore DTAA, and the addition made by the Assessing Officer was rightly deleted.

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