Cloud computing, revolutionizing IT services, allows users to access computing resources over the internet, eliminating the need for physical servers and infrastructure management. It promotes faster innovation, flexibility, and cost-effectiveness, as users pay only for the services they use. The three main models are Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and Software as a Service (SaaS). Taxability under the Income Tax Act depends on the nature of the services provided. Section 9(1)(vi) covers royalties, while Section 9(1)(vii) addresses fees for technical services (FTS). The interpretation of FTS involves assessing whether the services rendered are technical, managerial, or consulting in nature. In the evolving technology landscape, cloud computing is pivotal for businesses, offering access to advanced technology without the burden of infrastructure maintenance. Many e-commerce startups leverage cloud services for cost-effectiveness and scalability.