Management fees taxability under Indo Netherlands - Article 12

Facts:

Assessee a Dutch resident offered their ECB interest to tax in India and did not offer the management fees received from their Indian entity. It was the case of the revenue that management fees for rendering various management services was taxable as fee for technical services under Article 12 of the Indo-Netherlands DTAA. DRP upheld the views of the AO. On higher appeal -

Held in favour of the assessee that the scope of Article 12 of the Indo-Netherlands DTAA does not cover managerial services and accordingly it is not taxable.

Applied: Assessee's own case of earlier assessment years.

Ed. Note: There is no principle of res judicata in tax proceedings. Nonetheless it is ad nauseam if the same decided issue is contested by revenue on same grounds not for one year but for 4 assessment years of the assessee as in this case. Revenue has to concede these cases so that there is no proliferation of unwanted litigation. Management fee taxability is different under each DTAA and one has to see the fine print before taking a call.

Case: Inteva Products Netherlands BV v. ACIT 2023 TaxPub(DT) 1557 (Del-Trib)