Reimbursement of Salary for Seconded Employees Not Fees for Technical Services Under Article 12 India-US DTAA

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....The ITAT held that reimbursement of salary expenses for seconded employees deployed in India does not constitute fees for technical services under Article 12 of the India-US DTAA. The seconded personnel are employees of the Indian entity, whose salaries have already been taxed in India, precluding double taxation of the same amount in the hands of the assessee. The tribunal relied on prior coordinate bench decisions and Supreme Court precedent to affirm that the Indian entity alone is responsible for withholding tax on such salary payments. Consequently, the Assessing Officer was directed to delete the impugned addition, and the assessee's appeals were allowed.....