The Indian Authority for Advance Rulings (AAR) delivered a ruling in the case of Rotem Company (279 ITR 165) dated 26 August 2005 on whether fees paid to a consortium of foreign companies in connection with a contract for the design, supply, manufacture, testing and commissioning of a rail project in India was taxable as "fees for technical services" (FTS) under the India-Korea (Rep.) and India-Japan tax treaties (the tax treaties).
(a) Facts. The Applicants, Rotem (a company resident in…