“make available clause”

International TaxDTAA FTS ArticleDTAA FTS Article214 judgments

The decision most relied on for make available clause is Ishikawajima Harima Heavy Industries Ltd. v. DIT (288 ITR 408), cited in 394 judgments on BharatTax.

Leading authorities on make available clause

Ishikawajima Harima Heavy Industries Ltd. v. DIT

288 ITR 408 · 2007 · Supreme Court

394

citing judgments

Income from offshore supply of goods and services is not taxable in India if the entire transaction, including transfer of ownership and payments, occurs outside India.

CIT v. De Beers India Minerals (P.) Ltd.

346 ITR 467 · 2012 · High Court

371

citing judgments

For fees for technical or consultancy services to 'make available' technical knowledge or know-how under a DTAA, the service must transmit such knowledge, allowing the recipient to derive an enduring benefit and utilize it independently in the future.

DIT v. Nokia Networks OY

358 ITR 259 · 2013 · High Court

276

citing judgments

Payments for the supply of software along with telecom equipment are not in the nature of royalty if they are for the use of a copyrighted article, not the copyright itself. Such payments are not taxable in India in the absence of a Permanent Establishment (PE).

DIT v. Ericsson A.B

343 ITR 470 · 2012 · High Court

256

citing judgments

Payments for the use of copyrighted software or reimbursement of data processing costs do not constitute 'royalty' under Section 9(1)(vi) of the Income-tax Act or Article 12(3) of a DTAA where there is no transfer of copyright or rendering of services that "make available" technical knowledge. This position was later upheld by the Supreme Court.

DIT v. Guy Carpenter & Co Ltd.

346 ITR 504 · 2012 · High Court

171

citing judgments

For fees for technical services to be taxable under a tax treaty's 'make available' clause, a transfer of technology enabling the recipient to independently perform the service in the future is necessary, beyond mere service rendition. The case also clarifies that re-insurance services do not constitute 'imparting' of information taxable as royalty.

Raymond Ltd. v. Dy. CIT

86 ITD 791 · 2003 · ITAT

154

citing judgments

For services to qualify as 'Fees for Technical Services' or 'Fees for Included Services' under Double Taxation Avoidance Agreements (DTAAs), they must 'make available' technical knowledge, experience, skill, or processes to the recipient, enabling them to apply such expertise independently.

GVK Industries Ltd. v. Income Tax Officer

371 ITR 453 · 2015 · Supreme Court

119

citing judgments

Advice given by a financial consultancy firm on the modalities of procuring loans is considered a 'technical and consultancy service' for the purpose of taxation of fees for technical services.

EY Global Services Ltd. v. ACIT

441 ITR 54 · 2022 · High Court

citing judgments

Payments for software licenses that do not involve a transfer of copyright or proprietary interest, but merely authorize end-user access and use, do not constitute 'royalty' income. Additionally, IT support services are not taxable as Fees for Technical Services (FTS) or royalty.

Judgments citing make available clause

Digcert Inc, Usa vs. ACIT, Income Tax Officer, Circle Int. Taxation 1(2)(2), New Delhi

In the result, the appeal of the assessee is partly allowed

ITA 3626/DEL/2023[2021-22]Status: DisposedITAT Delhi14 Nov 2024AY 2021-22

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganeshdigicert Inc. Vs. Acit, 2600, West Executive Pkwy, Income Tax Officer, Suite 500 Lehi, Utah, Foreign, Circle International United States Taxation-1(2)(2), New Delhi (Appellant) (Respondent) Pan:Aaecd9837H Assessee By : Ms. Tanmayee Rajkumar, Adv Revenue By: Shri Vijay B. Basanta, Cit(Dr) Shri Amit Katoch, Sr. Dr Date Of Hearing 25/10/2024 Date Of Pronouncement 14/11/2024

For Appellant: Ms. Tanmayee Rajkumar, AdvFor Respondent: Shri Vijay B. Basanta, CIT(DR)

Section 143(3)Section 144C(1)Section 144C(13)Section 9(1)(vii)

taxable under the India US treaty. In the instant case, nowhere the lower authorities could bring with cogent evidence on record that the „make available clause‟ is duly satisfied so as to enable the end user to use the technology on his own. Hence the said services could

Rockwell Collins, Inc., United States of America vs. Deputy Commissioner of Income Tax, International Taxation, Circle 3(1)(1), Delhi

In the result, the appeal of the assessee in ITA No

ITA 2410/DEL/2023[2020-21]Status: DisposedITAT Delhi14 Nov 2024AY 2020-21

Bench: Shri M. Balaganesh & Shri Anubhav Sharmarockwell Collins Vs. Dcit, Southeast Asia Pte Ltd, Circle-3(1)(1), 18, Loyang Lane, Delhi 508918, Singapore, Singapore (Appellant) (Respondent) Pan:Aajcr7985R Rockwell Collins Inc, Vs. Dcit, 400, Collins Rd Ne, Circle-3(1)(1), Cedar Rapids, Ia 52498, Delhi United States Of America, Usa,52498 (Appellant) (Respondent) Pan:Aajcr7883E

For Appellant: Shri Rajan Vora, CAFor Respondent: Ms. C. Chandra Kanta, CIT DR

Section 9(1)(vii)

carry out repairs on its own without the assistance of the assessee. In our considered opinion, the services rendered do not satisfy the „make available‟ clause prescribed in Article 12 of India-Singapore treaty. Further, no technical knowledge, experience, skill, knowhow, technical plan or technical design was made available ... based services, what remains to see is whether they pass the test of make available or not under India USA DTAA. Interpretation of make available clause will differ with specific areas of the services under consideration. For instance, interpretation of make available for a concern providing services for the agricultural

Rockwell Collins Southeast Asia Pte Ltd, Singapore vs. Deputy Commissioner of Income Tax, Circle 3(1)(1), Civic Centre, Delhi

In the result, the appeal of the assessee in ITA No

ITA 2409/DEL/2023[2020-21]Status: DisposedITAT Delhi14 Nov 2024AY 2020-21

For Appellant: Shri Rajan Vora, CAFor Respondent: Ms. C. Chandra Kanta, CIT DR

Section 9(1)(vii)

Shell International Petroleum Company Limited, Mumbai vs. DDIT(It)-2(1), Mumbai

In the result, the appeal filed by the assessee is allowed

ITA 1253/MUM/2014[2009-10]Status: DisposedITAT Mumbai10 Sept 2024AY 2009-10

Bench: Ms. Kavitha Rajagopal, Jm & Smt. Renu Jauhri, Am M/S. Shell International Petroleum Dy. Director Of Income Tax Company Limited (International Taxation)-2(1) C/O. Bsr & Co. Llp, 1St Floor, Room No. 120, Scindia House, Vs. Lodha Excelus, Apollo Mills Ballard Estate, N.M. Road, Compound, N.M. Joshi Marg, Mumbai-400 038 Mahalaxmi, Mumbai-400 011 Pan/Gir No. Aaics 0357 B (Assessee) : (Respondent) Assessee By : Shri J. D. Mistry/ Madhur Agarwal/Ms. Reema Grewal Respondent By : Smt. Shaileja Rai Date Of Hearing : 13.06.2024 Date Of Pronouncement : 10.09.2024

For Appellant: Shri J. D. Mistry/For Respondent: Smt. Shaileja Rai

Section 143(2)Section 143(3)Section 144C(5)Section 2(24)Section 271(1)(c)

incidental benefit to the assessee which has been considered to be of enduring advantage. 21. In our understanding, in order to invoke make available clauses, technical knowledge and skill must remain with the person receiving the services even after the particular contract comes to an end and the technical knowledge

DCIT (It)-2(2)(1), Mumbai vs. Esab Holdings Limited, London

In the result, the appeal of the revenue is dismissed

ITA 2444/MUM/2024[2020-21]Status: DisposedITAT Mumbai09 Sept 2024AY 2020-21

Bench: Smt Beena Pillai & Shri Ratnesh Nandan Sahayassessment Year: 2020-21 Dcit (It)- 2(2), Esab Holdings Limited 6Th Floor, Room No.1722, 17Th Floor, 322 High Holborn, Air India Building, Wc1V 7Pb, Nariman Point, Vs. London, Mumbai- 400021.` Foreign United Kingdom Pan: Aabce6787C (Appellant) (Respondent)

For Appellant: Shri Ajit Jain & Siddesh Chaugule, A.RFor Respondent: Shri Anil Sant (SR. D.R.)

Section 250Section 270A

defined under the Tax Treaty. However, the Memorandum of Understanding (MoU) to the Tax Treaty between India and USA which has this "make available clause similar to the India-UK Tax Treaty which explains the term "make available as under "Generally speaking, technology will be considered "made available" when

DCIT (It) - 2(2)(1), Mumbai vs. Esab Holdings Limited, London

In the result, the appeal of the revenue is dismissed

ITA 2443/MUM/2024[2021-22]Status: DisposedITAT Mumbai09 Sept 2024AY 2021-22

Bench: Smt Beena Pillai & Shri Ratnesh Nandan Sahayassessment Year: 2021-22 Dcit (It)- 2(2), Esab Holdings Limited 6Th Floor, Room No.1722, 17Th Floor, 322 High Holborn, Air India Building, Wc1V 7Pb, Nariman Point, Vs. London, Mumbai- 400021.` Foreign United Kingdom Pan: Aabce6787C (Appellant) (Respondent)

For Appellant: Shri Ajit Jain & Siddesh Chaugule, A.RFor Respondent: Shri Anil Sant (SR. D.R.)

Section 250Section 270A

Treaty. However, the Memorandum of ESAB Holdings Limited; A. Y.2021-22 Understanding (MoU) to the Tax Treaty between India and USA which has this "make available clause similar to the India-UK Tax Treaty which explains the term "make available as under "Generally speaking, technology will be considered "made available" when

Shell Information Technologies International Bv, Mumbai vs. Deputy Commissioner of Income Tax (International Taxation)-4(2)(1), Mumba

In the result, the assessee’s appeal is partly allowed

ITA 4711/MUM/2023[2021-22]Status: DisposedITAT Mumbai06 Sept 2024AY 2021-22

Bench: Ms. Kavitha Rajagopal & Smt. Renu Jauhrishell Information V/S. Dcit (International Tax)- Technology International बनाम 4(2)(1), Bv 17Th Floor, Room No. 1708, C/O. Bsr & Co. Llp, Air India Building, 2Nd Floor, Lodha Excelus, Nariman Point, Apollo Mills Compound, Mumbai-400021 N.M. Joshi Marg, Mahalakshmi, Mumbai-400011 स्थायी लेखा सं./जीआइआर सं./Pan/Gir No: Aaics9091A Appellant/अपीलाथी .. Respondent/प्रतिवादी

For Appellant: Shri Madhur AgarwalFor Respondent: Smt. Shaileja Rai

Section 143(3)Section 144C(13)Section 144C(5)Section 153Section 2(24)Section 234ASection 234BSection 234C

make available' of technical services that such receipts would not amount to fee for technical services so as to the "concept of make available clause contained in Article 13(4)() of the treaty has not been satisfied In the given facts and circumstances of the case Hon, ble Delhi High ... fees for technical services'. Further, more, the Tribunal also held that such receipts would not amount to fees for technical services as the "make available" clause contained in article 13(4)(c) had not been satisfied in the facts and circumstances of the present case. Page 14 of 19 A.Y.2021-22

Lloyd'S Register Asia (India Branch Office), Mumbai vs. DCIT (International Taxation)-3(1)(2), Mumbai

In the result, all these appeals filed by the assessee are allowed for statistical

ITA 878/MUM/2024[2011-12]Status: DisposedITAT Mumbai29 Aug 2024AY 2011-12

Bench: Ms. Kavitha Rajagopal, Jm & Ms. Renu Jauhri, Am

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Anil Sant-Addl.CIT DR

Section 250

same cannot be enjoyed independently without the existence of the license agreement. The ld. A.O. also held that in such case the make available clause (c) of para 4 of Article 13 is not applicable in the present case where the management services are ancillary and subsidiary to the main

Deputy Commissioner of Income Tax(It)-3(1)(2), Mumbai vs. Lloyds Register of Shipping, Mumbai

In the result, all these appeals filed by the assessee are allowed for statistical

ITA 1777/MUM/2024[2021-22]Status: DisposedITAT Mumbai29 Aug 2024AY 2021-22

Bench: Ms. Kavitha Rajagopal, Jm & Ms. Renu Jauhri, Am

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Anil Sant-Addl.CIT DR

Section 250

Deputy Commissioner of Income Tax(It)-3(1)(2), Mumbai vs. Lloyds Register Asia, Mumbai

In the result, all these appeals filed by the assessee are allowed for statistical

ITA 1776/MUM/2024[2016-17]Status: DisposedITAT Mumbai29 Aug 2024AY 2016-17

Bench: Ms. Kavitha Rajagopal, Jm & Ms. Renu Jauhri, Am

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Anil Sant-Addl.CIT DR

Section 250

Lioyd'S Register Asia (India Branch Office), Mumbai vs. Deputy Commissioner of Income Tax (International Taxation -3(1)(2), Mumbai

In the result, all these appeals filed by the assessee are allowed for statistical

ITA 1455/MUM/2024[2016-17]Status: DisposedITAT Mumbai29 Aug 2024AY 2016-17

Bench: Ms. Kavitha Rajagopal, Jm & Ms. Renu Jauhri, Am

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Anil Sant-Addl.CIT DR

Section 250

Emerging Markets Equity Index Master Fund, Mumbai vs. DCIT (International Taxation)- 2(2)(1), Mumbai

In the result, all these appeals filed by the assessee are allowed for statistical

ITA 4588/MUM/2023[2021-22]Status: DisposedITAT Mumbai29 Aug 2024AY 2021-22

Bench: Ms. Kavitha Rajagopal, Jm & Ms. Renu Jauhri, Am

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Anil Sant-Addl.CIT DR

Section 250

Goodrich Corporation, United States of America vs. Assistant Commissioner of Income Tax, Circle 1(3)(1), New Delhi

In the result, the appeal of the assessee is allowed

ITA 988/DEL/2024[2018-19]Status: DisposedITAT Delhi22 Aug 2024AY 2018-19

Bench: Dr. B. R. R. Kumar, Sh. Sudhir Kumar

For Appellant: Sh. Nikhil Ranjan, AdvFor Respondent: Ms. Banita Devi Neorem, CIT-DR

Section 143(3)Section 147Section 153Section 234ASection 234BSection 234FSection 270A

based services, what remains to see is whether they pass the test of make available or not under India USA DTAA. Interpretation of make available clause will differ with specific areas of the services under consideration. For instance, interpretation of make available for a concern providing services for the agricultural ... make available is different for a concern engaged in providing services revolving around a highly specialized sector such as Aircraft industry. The make available clause deals with not only making available technical knowledge or know-how or processes or consist of the development and transfer of a technical plan

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2415/MUM/2023[2014-15]Status: DisposedITAT Mumbai12 Aug 2024AY 2014-15

Bench: SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

concession given to another OECD country subsequently. ITA No.2272-2276/Mum/2023 & CO No.123-128/Mum/2023 ITA No.2410-2415/Mum/2023 AYs 2012-2013 to 2017-2018 applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill ... been that the services under consideration make available technical skill, knowledge, experience etc. to the Assessee and therefore, satisfy the requirement of ‘Make Available Clause’ contained in the FTS Article of the applicable DTAAs. In this regard, it is admitted position that the Tribunal6 as well

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2414/MUM/2023[2015-16]Status: DisposedITAT Mumbai12 Aug 2024AY 2015-16

Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know ... liable to tax in India for identical reasons. We have also concluded that in case the countries having FTS Article with Make Available Clause, in the case of the Assessee for the preceding years, it has been held that the payments for services of similar nature were not liable

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2413/MUM/2023[2016-17]Status: DisposedITAT Mumbai12 Aug 2024AY 2016-17

Bench: IN THE INCOME TAX APPELLATE TRIBUNAL "I" BENCH, MUMBAI SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

ITA 2412/MUM/2023[2017-18]Status: DisposedITAT Mumbai12 Aug 2024AY 2017-18

Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know ... Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax -16(2), Mumbai

ITA 2411/MUM/2023[2012-13]Status: DisposedITAT Mumbai12 Aug 2024AY 2012-13

Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know ... been that the services under consideration make available technical skill, knowledge, experience etc. to the Assessee and therefore, satisfy the requirement of ‘Make Available Clause’ contained in the FTS Article of the applicable DTAAs. In this regard, it is admitted position that the Tribunal6 as well

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax -16(2), Mumbai

ITA 2410/MUM/2023[2013-14]Status: DisposedITAT Mumbai12 Aug 2024AY 2013-14

Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know ... Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know

DCIT, Cir 16(2), Mumbai vs. M/S Kpmg Assurance and Consulting Services LLP, Mumbai

ITA 2277/MUM/2023[2017-18]Status: DisposedITAT Mumbai12 Aug 2024AY 2017-18

Assessee could no longer claim the shelter of MFN Clause for the purpose of importing into the applicable DTAA the ‘Make Available Clause’ and contend that the professional fee paid/payable to the non-residents were not liable to tax in India as FTS since no technical knowledge, skill, experience, know ... been that the services under consideration make available technical skill, knowledge, experience etc. to the Assessee and therefore, satisfy the requirement of ‘Make Available Clause’ contained in the FTS Article of the applicable DTAAs. In this regard, it is admitted position that the Tribunal6 as well