Salary to Seconded Employees Is Not FTS – ITAT Delhi Deletes ₹10.76 Cr Addition in Toshiba Case

Toshiba Corporation Vs DCIT (ITAT Delhi) Addition of ₹10,76,36,392 was made by treating reimbursements of salary for seconded employees as Fee for Technical Services (FTS) u/s 9(1)(vii) & Article 12(4) of India–Japan DTAA. Assessee, tax-resident of Japan, had paid salaries in Japan on behalf of Indian Toshiba group entities, which reimbursed the Assessee without markup, with TDS duly deducted by Indian employers. To prove secondment & employer–employee relationship with Indian entities, the Assessee produced payroll agreements, employment contracts, appointment letters, Form 16s,...