Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: list of goods taxed at 4% :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: Central Excise rule to resale the machines to a new company :: articles on VAT and GST in India :: cpt :: VAT RATES :: VAT Audit :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: form 3cd :: TAX RATES - GOODS TAXABLE @ 4% :: empanelment :: TDS :: ACCOUNTING STANDARD :: ACCOUNTING STANDARDS
News Headlines »
 CBDT releases Income Tax Return statistics for last two fiscals
 CBDT issues second round of Certificates of Appreciation to tax payers for their contribution towards Nation building
 FinMin looks at cut in corporation tax
 Draft Rules for prescribing the method of valuation of fair market value in respect of the trust or the institution-Chapter XII-EB of the Income-tax Act, 1961- reg.
 India is moving towards a flawed GST
 ICAI to organise two-day international conference in Hyderabad
 Here's how to calculate tax payable on your capital gains
 Income Tax calculations for the financial year 2016-17
 CPE Events 17 October - 22 October 2016
 High Court raps I-T Department for wrong tax demand
  CBDT signs 5 advance pricing pacts with Indian taxpayers

MNC's fee income comes under tax net
January, 10th 2007

In a judgment which could have a bearing on the activities of multinational companies in India, the Authority for Advance Ruling (AAR) has decided that the International Hotel Licensing Company, which markets the Marriott brand, will have to pay tax on fee income received from its Indian partner.

The company's Luxembourg-based parent International Hotel Licensing Company Investments argued that the income earned by its subsidiary is the result of its global advertising, marketing and sales programme and it is not liable to pay tax in India.

In 2005, different Marriott group entities entered into various agreements with Unitech Hospitality, an Indian company, for a hotel in Noida in Uttar Pradesh.

In September 2005, International Hotel Licensing entered into an international marketing programme participation agreement' with the Unitech group. The agreement provides that overseas marketing and business promotion (co-ordinating global marketing activities) of Marriott will be carried out by International Hotel Licensing which will get an annual contribution of 1.5% of the gross revenues of the hotel and 3.4% of members gross room revenues.

Considering that International Hotel Licensing is getting a fixed revenue from Unitech and the the agreement is valid for 25 years (with further extension of 10 years), AAR has ruled that a business connection is established between Unitech and International Hotel Licensing.

Since there is no double taxation avoidance agreement between India and Grand Duchy of Luxemborg, the tax liability of International Hotel Licensing is decided as per Indian income tax laws.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - About Us

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions