Indian Tribunal Holds MFN Clause Regarding Fees for Technical Service in Tax Treaty with Israel Applies Automatically

The Ahmedabad Income Tax Appellate Tribunal recently issued a decision concerning the application of the MFN clause originally included in the 1996 India-Israel tax treaty in relation to fees for technical services (FTS). The case involved an Indian pharmaceutical company that made payments to a company in Israel for active pharmaceutical ingredient and formulation services. The Indian company claimed that based on the MFN clause included in the final protocol to the original treaty, the paym…