Management fees/Business support fees -- Indo Netherlands DTAA Article 12(5)

Facts: Assessee, a Dutch non-resident was in recipient of management fees from his AE's in India. Revenue alleged it to be taxable as per Article 12(5) of Indo-Netherlands DTAA. Assessee's plea was scope of Article 12(5) of the DTAA did not cover management consultancy, besides they did not "make available" any benefit to the assessee. Aggrieved by the order of the lower authorities, assessee went to ITAT -

Held in favour of the assessee that the Indo-Netherlands DTAA Article 12(5) does not cover management consultancy in its scope, thus is outside the scope of taxability in India.

Ed. Note: Each DTAA reads differently when it comes to management fees. For instance Swiss DTAA covers management consultancy in its scope and hence is taxable as per that DTAA. Points like "make available", "Most favoured nation" clause etc., are also beneficial pointers to claim non-taxability of such incomes from India provided the DTAA wording carries these in its scoping.

Case: Inteva Products Netherlands BV v. ACIT 2023 TaxPub(DT) 783 (Del-Trib)