Taxability of receipts arising out of event management in India - Indo-US DTAA - Article 7 vs 23

Facts:

Assessee was a US resident in the business of branding, talent management and also a mediator for many worldwide events. They were in receipt of Rs. 4.15 crores for having organized an artist Maroon 5's show in India thru one Big Tree Entertainment Pvt. Ltd. in India. This was allegedly to be taxable under Article 23 of the Indo-US DTAA as Other income vis a vis assessee's claim that the same was business profits taxable as per Article 7 and in the absence of a PE no tax can be fastened on the same in India. This did not meet the eye of the AO and DRP. On higher appeal by the assessee -

Held in favour of the assessee that the event management fees was business income and in the absence of a PE the same cannot be taxed in India.

Ed. Note: There are a number of cases where if the revenue could not tax it as a business profit they have tried restoring taxing it through Other income clause of the DTAA provisions. What the revenue seems to have missed is that the basic fact of income characterization has to dovetail the similar income taxability in India for a resident and it obviously has to be almost the same even for a non-resident logically. If this facet was well entrenched a number of appeals would have simply become otiose.

Case: We Are Voices Entertainment Inc. v. DCIT 2023 TaxPub(DT) 4600 (Del-Trib)