Go Daddy. Com LLC Vs ACIT (ITAT Delhi)
ITAT Delhi held that income earned by GoDaddy.com from providing domain name registration services to Indian Customers is not taxable in India. Further, income from provision of non-domain service fall outside ambit of Fee for Technical Services and hence not taxable.
Facts- The GoDaddy.com LLC a limited liability company is one of the world’s largest Internet Corporation, for Assigned Names and Numbers (“ICANN”) accredited domain name registrars and provided other web services to its customers across the world. The Appellant, through its website (Godaddy.Com) is engaged in the business of providing facilitation of domain name registration, web hosting, web designing, SSL certification and other services.
In conclusion of scrutiny assessment, AO held that income from domain name registration charges falls within the definition of royalty; income non-domain services are taxable as fees for technical services. Also held that Appellant is not entitled to benefits under the India-USA tax treaty as only persons or entities that are ‘liable to tax’ under the laws of that country are considered to be residents for the purpose of tax treaties and since LLCS are fiscally transparent entities according to tax laws of the USA, their income is not ‘subject to tax in their own hands in the USA and should not qualify as ‘residents’ of USA in terms of Article 4 of the India-USA DTAA.
