Assessee French airlines was a member of International Airlines Technical Pool (IATP). It derived income from (i) Carriage of passage, (ii) Carriage of cargo, (iii) Interest income from funds directly connected with the operation of aircraft in International Traffic and (iv) Income from technical handling to other IATP Pool Members.  The Assessing Officer passed an assessment order treating the Technical Income as “fee for technical services” at Rs. 1.82 crore covered under section 115A, read with section 44D and taxed the same at 20 per cent of the gross receipts.  CIT(A) partly allowed the appeal. Tribunal held that IATP manual clearly set out that there is no bar on member airline to provide service to non IATP Pool Member and in fact, even non IATP Pool members if takes such service from a pool would be considered as a pool service to them; thus, assessee being a pool member and providing service in that capacity to guest members would come under purview of Article 8(2) of DTAA between India and France. Therefore CIT(A) was not right in sustaining the taxability to the extent of Rs. 3,70,098 under Article 7 of the DTAA. Appeal of the assessee  was allowed. (AY. 2004-05, 2005-06,  2006-07)