Amount of executive search fee is not ‘fee for technical services’ and hence not taxable

Spencer Stuart International B.V. Vs ACIT (ITAT Mumbai)

ITAT Mumbai held that Executive search fee is not ‘fee for technical services’ under Article 12(5)(a) as well as 12(5)(b) of the India Netherlands Tax Treaty.

Facts-

The assessee is a tax resident of Netherlands and is entitled to the benefits of India-Netherlands tax treaty. The assessee is engaged in business of executive search services and related support services to group companies and third-party franchises. The case of the assessee was selected for scrutiny and vide draft assessment order dated 23/09/2021 passed u/s. 144C of the Act total income of the assessee was computed at Rs. 21,16,51,560, after making various additions. The assessee filed detailed objections before the learned DRP. Vide directions dated 05/01/2022, issued u/s. 144C(5) of the Act, objections filed by the assessee were rejected, inter-alia, following the directions issued in assessee’s own case for preceding assessment years. In conformity, AO passed the final assessment order dated 21/01/2022 u/s. 143(3) read with section 144C(13) of the Act. Being aggrieved, the assessee is in appeal before us.

Conclusion-

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