IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “DB”NEW DELHI BEFORE SHRI YOGESH KUMAR US, JUDICIAL MEMBER AND SHRI SANJAY AWASTHI, ACCOUNTANT MEMBER आ.अ.स/ं .I.T.A No.250/DDN/2025 िनधा(cid:9)रणवष(cid:9)/Assessment Year:2016-17 DY. COMMISSIONER OF INCOME TAX, बनाम HALLIBURTON WORLDWIDE GMBH Aayakar Bhawan, 13-A, Subhash Road, Vs. 1^st Floor, IDA, 46, E.C. Road, Dehradun, Uttarakhand. Dehradun- 248001,Uttarakhand.

PAN No.AADCH1061Q अपीलाथ(cid:20) Appellant (cid:22)(cid:23)यथ(cid:20)/Respondent Assessee by Shri Amit Arora, CA &Shri Vishal Mishra, CA Revenue by Shri Mohan Lal Joshi, Sr. DR सुनवाईक(cid:8)तारीख/ Date of hearing: 11.02.2026 उ(cid:14)ोषणाक(cid:8)तारीख/Pronouncement on 18.02.2026 आदेश /O R D E R PERSANJAY AWASTHI, ACCOUNTANT MEMBER:

1. The present appeal arises from order u/s 250 of the Income Tax Act, 1961 (hereafter “the Act”), dated 16.09.2025, passed by Ld. CIT(A)- Noida-2. In this case, the Ld. AO is seen to have held the receipts on account of IP Charges received from Halliburton Offshore Services Inc. amounting to Rs.77,66,43,479/- to be in the nature of “Royalty” u/s 9(1)(vi) of the Act, which has been held to be taxable u/s 115A of the Act. Notably the assessee had claimed such receipts to be in the nature of “Royalty” in terms of Article 12 of the Indo-Swiss DTAA. Furthermore, the AO is seen to have held the receipts on account of sale of software amounting to Rs. 709,34,733/- also as “Royalty” u/s 9(1)(vi) of the Act, which is taxable u/s 115A of the Act. Here also the assessee had claimed such receipts to be non-taxable in India in the absence of PE in terms of Articles 5 & 7 of the Indo Swiss DTAA.

1.1 Aggrieved with this action, the assessee approached the Ld. CIT(A) where he could succeed in full, with all the additions deleted.The relevant portions from the CIT(Appeals) order deserves to be extracted as under: -

“5.1.1 Vide these grounds of appeal, the appellant has contended that on the facts and circumstances of the case, the AO has erred in not appreciating that the provisions of the Double Taxation Avoidance Agreement override the provisions of the income Tax Act, 1961. The appellant has that the AO has erred in law in characterizing the revenue received on account of IP Charges received from Halliburton Offshore Services Inc. amounting to Rs.77,66,43,479/- as royalty under section 9(1)(vi) of the Act taxable u/s 115A of the Act, as opposed to the claim of the appellant that such receipts are in nature of royalty receipt in terms of Article 12 of Indo-Swiss DTAA.

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5.1.3 I have carefully gone through the facts of the case, submissions of the appellant and case laws relied upon by the appellant. During the year under consideration, the appellant had received IP Charges of Rs.77,66,43,479/- from Halliburton Offshore Services Inc. and it has offered the same to tax as royalty receipt in terms of Article 12 of Indo-Swiss DTAA. The AO in the assessment order has taxed the same @ 10% u/s 115A of the Act. The appellant has argued that tax rate applicable as per Indo-Swiss treaty is also 10% but the same is inclusive of surcharge and education cess.

5.1.4 On critical examination of facts, it is noted that the appellant has no PE in India and this fact is not under dispute. Since, the appellant has no PE in India, the appellant is free to adopt beneficial rate of taxation as per DTAA or under the Income-tax Act in respect of IP charges received from Halliburton Offshore Services Inc. The appellant had offered the said receipts to be taxable under DTAA. Careful reading of provisions of DTAA between India and Swiss Government provides that royalties and fees for technical services arising in a Contracting State and paid to a resident of the other Contracting State may be taxed in that other State. However, such royalties and fees for technical services may also be taxed in the Contracting State in which they arise and according to the laws of that State; but if the beneficial owner of the royalties or fees for