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 Article 7 (Business Profits) of India-Norway DTAA applies, not Article 12 (FTS). Ass...