Management fee whether royalty/FTS under Indo-Dutch DTAA

Facts :

Assessee a dredging contractor based out of Netherlands had charged its Indian entity Van Oord India Pvt. Ltd. by way of management support services/fees. Case of the revenue was that these were fee for technical services (FTS) and were taxable under Article 12(4)of Indo-Dutch DTAA @ 10%. Plea of assessee was there was no technical element in them and were only general management support. There was no income for the assessee arising out of dredging operations in this year (to be noted). Since this management fee was the only income for the assessee they ought to be granted set off against this income with brought forward losses and expenses of unabsorbed depreciation of the current + past years if at all the management fee was held to be taxable as FTS in India. DRP upheld views of AO. On further appeal by assessee to ITAT -

Held in favour of the assessee that the management fees did not make available or brought in any technical information worthy of exploitation thus was not taxable as FTs. Other appeal points were not worthy of discussion.

Applied : Assessee's own cases of earlier years.

Ed. Note : The carry forward and set off of losses/unabsorbed depreciation appeal point is worth noting.

Case: Van Oord Dredging and Marine Contractors B.V. v. Asstt. CIT2023 TaxPub(DT) 2286 (Mum-Trib)