Case Law Details
Expeditors International of Washington Vs ACIT (ITAT Delhi)
ITAT Delhi held that the amount received by the assessee from freight/logistic support services cannot be treated as FTS/FIS either under section 9(1)(vii) of the Income Tax Act or under tax treaty provisions and hence the same is not taxable in India.
Facts-
Assessee is a non-resident corporate entity incorporated in United States of America and its headquarter is at Washington. The assessee is primarily engaged in the business of providing global logistic services worldwide. The assessee carries out operations in various segments, such as airfreight, ocean freight and ocean services, vendor consolidation, cargo insurance, purchase order management and customized logistics information.
In the course of assessment proceedings, AO noticed that an amount was received by the assessee from India sale of logistic services which was not offered to tax on the plea that such services were rendered outside India, hence, not taxable. However, AO held that the amount received by the assessee is in the nature of FTS/FIS under section 9(1)(vii) of the Act and Article 12(5) of the tax treaty, hence, the amount is taxable in India. Being aggrieved, the present appeal is filed.
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