ITAT affirmed that fees received for turnkey offshore supply and management services do not constitute "Fees for Technical Services" under the Act or the India-UK DTAA because the services did not "make available" technical knowledge or skills to the recipient; the services were managerial, annually renewable, and passed arm's-length scrutiny, so taxation as FTS was unwarranted. Relying on similarity of legal and factual matrix with a prior assessment year, ITAT also held there was no permanent establishment or dependent agent PE (PE/DAPE) in India. Both grounds were decided in favor of the taxpayer, overturning the assessing authority's imposition of Indian taxing rights.
ITAT affirmed that fees received for turnkey offshore supply and management services do not constitute "Fees for Technical Services" under the Act or the India-UK DTAA because the services did not "make available" technical knowledge or skills to the recipient; the services were managerial, annually renewable, and passed arm's-length scrutiny, so taxation as FTS was unwarranted. Relying on similarity of legal and factual matrix with a prior assessment year, ITAT also held there was no permanent establishment or dependent agent PE (PE/DAPE) in India. Both grounds were decided in favor of the taxpayer, overturning the assessing authority's imposition of Indian taxing rights.
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