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2007 (10) TMI 452 - AT - Income TaxIncome deemed to accrue or arise in India - Liability to Deduct tax at source u/s 195 - non-resident in India - remittance towards rating fees - whether the remittance for the services provided by Moody’s by providing commercial information falls within the category of ''fees for included services'' defined in article 12 of DTAA with USA? - HELD THAT:- For bringing any payment within the definition of ‘fee for included services’ the non-resident must make available the technical skill, expertise or technical know-how to the assessee, on the basis of which non-resident has prepared or developed the commercial information. Undisputedly in the instant case the technical skill, expertise or technical know-how used in preparing the commercial information was not made available to the assessee and hence the remittance made by the assessee for obtaining such commercial information cannot be called to be the ‘fees for the included services’ to make it chargeable to tax in India. We have also examined the judgment referred to by the assessee in the case of Raymond Ltd.[2002 (4) TMI 891 - ITAT MUMBAI] in which the Tribunal has taken a similar view that although the services rendered by the lead manager and other managers of a foreign company in connection with GDR issue of the assessee company are managerial or consultancy service and falls within the definition of technical services under section 9(1)(vii) read with Explanation 2 thereto, said payments do not fall within the definition of fees for technical services under article 13 4(c) of the DTAA with UK which is applicable to the facts of the case and were not taxable in India. Thus, we are of the considered view that remittance made in the instant case are not in the nature of ‘fees for included services’ as such are not taxable in India. We, therefore, of the view that the assessee cannot be held to be responsible/liable for deduction of tax u/s 195 of the Act. We accordingly, set aside the order of CIT(A). In the result, appeal of the assessee is allowed.
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