Tech Data (Singapore) Pte Limited Vs DCIT (ITAT Mumbai)
The assessee filed an appeal before the Income Tax Appellate Tribunal against the assessment order dated 20.10.2023 passed under Sections 143(3) read with 144C(13) of the Income-tax Act, 1961 pursuant to the directions of the Dispute Resolution Panel (DRP), relating to Assessment Year 2021-22. The appeal challenged the assessment of management/service fees as Fees for Technical Services (FTS), the levy of interest under Sections 234A and 234B, and the initiation of penalty proceedings under Section 274 read with Section 270A of the Act.
The principal dispute concerned the addition of ₹38,56,25,301 towards management/service fees. The Assessing Officer treated the management/service fees received by the assessee as taxable Fees for Technical Services under the Income-tax Act read with Article 12 of the India-Singapore Double Taxation Avoidance Agreement (DTAA). According to the assessee, the services rendered did not make available any technical knowledge, experience, skill, know-how or processes enabling the recipient to apply the technology independently, as required under Article 12(4)(b) of the India-Singapore DTAA.
At the outset, the assessee submitted that the issue was fully covered in its favour by the Tribunal’s decision in its own case for Assessment Year 2020-21 in ITA No. 3280/Mum/2023. The Departmental Representative fairly conceded that the issue stood covered and could not point out any distinguishing decision in favour of the Revenue.
