https://www.taxtmi.com/caselaws?id=752591 The ITAT Delhi held that the final assessment order was invalid due to the AO's failure to implement DRP directions regarding royalty/FTS receipts treatment. The AO treated licence fees as equipment royalty under section 9(1)(vi) and India-Czech DTAA Article 12, claiming IT infrastructure constituted scientific/commercial equipment. However, despite DRP's specific directions to demonstrate how IT infrastructure qualified as equipment providing usage rights, the AO failed to provide supporting evidence in the final order. The assessee had argued licence fees were for non-exclusive software usage rights, not equipment royalty. The ITAT found this constituted non-compliance with section 144C(13) mandate, rendering the assessment order jurisdictionally invalid and quashed it. en-us Fri, 10 May 2024 00:00:00 +0530 Tue, 14 May 2024 06:54:14 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=752591 The ITAT Delhi held that the final assessment order was invalid due to the AO's failure to implement DRP directions regarding royalty/FTS receipts treatment. The AO treated licence fees as equipment royalty under section 9(1)(vi) and India-Czech DTAA Article 12, claiming IT infrastructure constituted scientific/commercial equipment. However, despite DRP's specific directions to demonstrate how IT infrastructure qualified as equipment providing usage rights, the AO failed to provide supporting evidence in the final order. The assessee had argued licence fees were for non-exclusive software usage rights, not equipment royalty. The ITAT found this constituted non-compliance with section 144C(13) mandate, rendering the assessment order jurisdictionally invalid and quashed it. Case-Laws Income Tax Fri, 10 May 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=752591