DTAA Aviation Income
By J the App
Executive Summary
The Tribunal upheld the order of the CIT(A) dated 30.06.2025, holding that technical handling income, interest on FDRs, and commission income are exempt under Article 8 of the India–France DTAA as being directly connected with operation of aircraft in international traffic.
However, “collection charges” retained from PSF/UDF were held taxable as they lack such nexus.
The ruling consolidates settled jurisprudence that treaty protection extends to all income intrinsically linked to airline operations, but not to incidental or incentive-based receipts.
This decision arises from a batch of cross appeals in ITA Nos. 01/Del/2025, 02/Del/2025 and 5207/Del/2025 for AYs 2019–20 and 2020–21, decided by the Income Tax Appellate T...
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