ITAT Ruling on Taxability of FTS, in absence of specific clause in DTAA

Diamond Manufacturing Management and Consultancy Ltd. Mauritius vs ACIT (ITAT Visakhapatnam)

Background

The ITAT in its recent judgment held that where a company incorporated in Mauritius received fees for entering into a technical collaboration with its Associated Enterprise (AE) in India, aimed at providing technical, process, marketing and sales assistance services outside India, in the absence of specific clause under DTAA not dealing with particular item of income, such fees would be treated as business income instead of residuary income. Further, in th

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