1. S.245R : Advance ruling – Ruling sought on questions relating to fees for technical services – Not a device to avoid tax – Income from royalty and interest declared in return and taxability conceded – DTAA – India-Belgium-Portugal – Application admitted

The applicant raised questions about the taxability of the income generated by fees for technical services relying on the Double Taxation Avoidance Agreements between India and Belgium and between India and Portugal. The Department objected to admission of the application on the ground that after filing the application, the applicant had filed a return declaring,
inter alia, income on account of royalty and interest on which tax had been charged and, therefore, in not seeking a ruling on any question pertaining to royalty or interest, the applicant had tried to avoid payment of income-tax. The Authority ruled :

That the three questions on which rulings were sought did not pertain to income on royalty or the income generated on account of earned interest. There was no statement in the application that the applicant did not have an income from royalty or from interest and the applicant conceded the taxability of the royalty and interest income. Therefore, this could not be seen as a device to avoid tax. The application was to be admitted.

Magotteaux International S.A. Belgium, in re (2015) 373 ITR 658(AAR)

2. S.245R : Advance ruling – Non-resident – Assessing Officer not informed of application before Authority – Application admitted

Where the Department objected that after filing the application when the matter proceeded before the Assessing Officer on the basis of the return filed by the applicant the Assessing Officer was not informed about the applicant having filed the application before the Authority, the Authority ruled, that admittedly, the applicant was a non-resident Indian. Considering that the applicant was not an Indian taxpayer the application was admitted.

Soregam S. A., Belgium, In re (2015) 373 ITR 660 (AAR)

RESEARCH TEAM