Freight from transportation of cargo via feeder vessels covered under India-France Tax Treaty not taxable

CMA CGM SA C/o. CMA CGM Agencies (India) Private Limited Vs ACIT (ITAT Mumbai)

ITAT Mumbai held that freight charges received from transportation of cargo through feeder vessels being part of shipping income in International Traffic is covered under Article–9(1) of the India–France Tax Treaty and hence not taxable in India.

Facts- Assessee alleged that AO has erred in making addition on account of Inland Haulage Charges as the same are not taxable in India as per Article 9 of India-France DTAA.

Further, assessee also alleged that AO and DRP have erred in holding that freight charges for transportation of cargo through feeder vessels is income taxable in the hands of assessee under section 44B of the Act.

Conclusion- Respectfully following the decision of the Co–ordinate Bench rendered in assessee’s own case in the preceding assessment years, we hold that Inland Haulage Charges, since, forms part of income from operation of ships in International Traffic, is covered under Article–9 of the India–France Tax Treaty, accordingly, not taxable in India.

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