ITAT Delhi deletes TDS demand – Repair/Replacement of spare parts is NOT Fees for Technical Services

Hal Offshore Ltd. Vs ITO (ITAT Delhi)

AO treated the assessee as ‘assessee in default’ u/s 201(1)/201(1A) for not deducting TDS of ₹16,80,590 on payments made to Brunvoll AS, Norway for repair and replacement of ship parts.

Facts:

• Assessee paid ₹78,18,744 + ₹29,09,960 to Norwegian vendor for replacing defective parts of its ship.
• Vendor’s personnel came to India for only 29 days.
• Vendor had no PE in India.
• Assessee argued that it was a works contract / sale with incidental installation, therefore Art

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