GIS Software License Charges from UK Company to Indian Associates Not Taxable as Technical Services Under DTAA

The ITAT ruled that GIS charges received by a UK-based foreign company from its Indian AEs for software licenses do not qualify as Fees for Technical Services under the India-UK DTAA. The Tribunal determined that subletting software licenses without providing training, customization, or technical support does not involve transfer of technical knowledge or expertise. The procurement and allocation of licenses were deemed mere administrative functions rather than specialized services. The ITAT rejected the AO's application of the "make available" clause, finding no technical knowledge was imparted to Indian entities. The Tribunal directed that such receipts be examined under business income principles and deleted the addition made by the AO. The issue of fees under section 234F was set aside to the AO for appropriate action. .....

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