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2016 (12) TMI 1338 - AT - Income TaxTDS u/s 195 - taxability of the payment made by the assessee to ‘Intelsat Corporation US’ and ‘Intelsat Global Sales and Marketing Limited, UK’ for availing transponder facility in pursuance of Service Agreement read with Service orders - P.E. in India - busniss connection - Held that:- The payment made by the assessee to Intelsat is not taxable as royalty in India and, therefore, assessee was not required to deduct TDS or withhold any tax on such payments. This proposition has been upheld by Hon’ble Supreme Court in the case of GE Technology Centre [2010 (9) TMI 7 - SUPREME COURT OF INDIA ] So far as the issue relating to FTS is concerned, we find that, this Tribunal in B4U International Holdings (2012 (6) TMI 15 - ITAT MUMBAI) on similar payment made to Panamsat, it was held that they do not satisfy the test of “make available” as enshrined in Article 12(3) in Indo-US-DTAA and thus, the said payment cannot be held to be taxable as being for technical services and secondly, on this ground also, the provision of TDS is not attracted. In any case Ld. CIT (A) cannot hold that same payment would fall in the nature of ‘royalty’ and at same time would be reckoned as ‘FTS’ also. As regards the issue of business communication in India, simply because the transponders have been used in for business in India will tantamount to business connection of Intelsat in India and, accordingly, such an observation and finding of the CIT(A) is hereby rejected by us. - Decided in favour of assessee. Interest u/s 244A on refund of extra TDS deposited under section 195 - Held that:- Issue should be remanded back to the file of the Assessing Officer to decide the matter after considering the latest CBDT Circular No.11 of 2016 dated 26th April, 2016. We order accordingly
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