Software Cost Cross-Charge Not FIS/Royalty – ITAT Delhi Follows Earlier Year in SNC Lavalin Case

SNC Lavalin Inc. Vs ACIT (ITAT Delhi)

ITAT Delhi held that ₹1.45 crore GIT infrastructure charges received by the Canadian engineering firm for use of third-party software (AutoCAD, Civil 3D, etc.) from its Indian affiliates were not taxable as Fees for Included Services (FIS) or royalty.

Following its own ruling for AY 2021-22, Tribunal found that:

• The payments were mere cost reimbursements for software licences, not consultancy.
• No technical knowledge was made available under Art. 12(4)(b) of the India-Canada DTAA.<

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