Business support service is tax exempt applying MFN clause under India-Belgium tax treaty

  • Blog|International Tax|News|
  • 85 Views
  • |
  • < 1 minute
  • By Taxmann
  • |
  • Last Updated on 28 March, 2022

Business support service; MFN clause under India-Belgium tax treaty;

Shailendra Sharma – [2022] 136 taxmann.com 290 (Article)

Indian tax tribunal regards business support services that do not make available technology, skill, know-how, etc., to the Indian company is tax exempt under the provisions of Fees for Technical Services of the India-Belgium tax treaty by invoking the Most Favoured Nation restrictive make available clause from the India-Portugal tax treaty explained by Shailendra Sharma.

(Magotteaux International SA v. DDIT IT Appeal No. 1358 (Delhi) of 2015, dated 17-2-2022 in a case appealed before the Delhi Bench of the Income-tax Appellate Tribunal (Tribunal) contested on the taxability of business support services under Article 12 of the India-Belgium tax treaty (tax treaty). The Tribunal concluded that business support service is tax-exempt as Fees for Technical Services (FTS) under the tax treaty.

The Tribunal regarded the business support services as not any specific technology, skill, know-how, etc. service made available to the Indian company to not qualify as FTS by invoking the Most Favoured Nation (MFN) Clause of the tax treaty, by reading through the restricted or beneficial make available clause of the India-Portugal tax treaty into the India-Belgium tax treaty.

Click Here To Read The Full Article

Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.

Leave a Reply

Your email address will not be published. Required fields are marked *

Everything on Tax and Corporate Laws of India

To subscribe to our weekly newsletter please log in/register on Taxmann.com

Author: Taxmann

Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.

The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:

  • The statutory material is obtained only from the authorized and reliable sources
  • All the latest developments in the judicial and legislative fields are covered
  • Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
  • Every content published by Taxmann is complete, accurate and lucid
  • All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
  • The golden rules of grammar, style and consistency are thoroughly followed
  • Font and size that's easy to read and remain consistent across all imprint and digital publications are applied