2024 (10) TMI 1828

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....of the Income Tax Act, 1961 ('the Act'), pertaining to the Assessment Years ('A.Y.' for short) 2017-18 to 2019-20. 2. As the facts are identical in all the appeals, we hereby pass a consolidated order by taking ITA No. 1814/Mum/2024 as a lead case. ITA No. 1814/Mum/2024 (A.Y. 2019-20) 3. In all these appeals the Revenue has challenged the ld. CIT(A)'s order on the ground that the Ld. CIT(A) has erred in holding that the borrowed service fees received by the assessee from Mckinsey India does not constitute fee for technical service and the same falls within the ambit of 'business profit' as per Article 7 of the India Singapore Double Taxation Avoidance Agreement and other relevant DTAAs and also in holding the income as 'busines....

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.... claimed exemption of Rs.20,76,36,067/- towards 'borrowed services/advisory support' rendered to M/s. Mckinsey India as per Indo Singapore Tax Treaty. The ld. A.O. passed the draft assessment order u/s. 144C of the Act dated 20.09.2021, where the total income was determined at Rs.20,84,66,151/- after making an addition of Rs.20,76,36,061/- as 'fee for included services' and Rs.8,30,090/- as 'reimbursement of expenses'. The ld. A.O. then passed the final assessment order dated 26.10.2021 u/s.143(3) r.w.s. 144C(3) of the Act. 6. The assessee was in appeal before the first appellate authority and the ld. CIT(A) vide order dated 24.01.2024 deleted the impugned addition on the ground that on identical facts the Tribunal for A.Ys. 2012-13, 201....

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.....1579/Mum/2014 vide order dated 21.10.2016), wherein it has been held that the loaned service charges/borrowed services received by the assessee was not in the nature of 'royalty or fees for included services' and the same was not chargeable to tax in India for the reason that the assessee had no PE in India. 9. Pertinently, it is observed that there has been a Mutual Agreement Procedure (MAP) resolution for A.Y. 2007-08 in the group cases of the assessee, pertaining to India-USA DTAA (vide Order No. 480/2/2008-FTD.1 u/s.90 of I.T. Act, 1961 r.w. Article 27 of India-USA DTAC) which has been extensively relied upon by the assessee, where the said receipt was held to be not taxable in India and the Revenue after duly accepting the same has....