No deduction for Rio Tinto under Income Tax Act: Delhi High Court

In am important decision, Delhi High Court ruled that even though Rio Tinto Technical Services (assessee) income in India was chargeable to tax as “business profits” under Article 7 and not as “fees for technical services” under Article 12 of the India-Australia Double Taxation Avoidance Agreement (DTAA), Section 44D of the Income Tax Act (Act) is applicable as the income received by the assessee is “fees for technical services” under Explanation 2 to Section 9(1)(vii) of the Act.

Hence, no deduction shall be allowed to the assessee.

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