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2014 (12) TMI 423 - AT - Income TaxPayments received to be treated as royalty or not u/s 9(1)(vi)&(vii) as well as Article 13(4) of DTAA – Whether the receipt can be said to be FTS - Held that:- Following the decision in DAMPSKIBSSELSKABET AF 1912 A/S AKTIESELSKABET, MUMBAI Versus. ADIT(IT) [2010 (6) TMI 462 - ITAT, MUMBAI] - The definition of FTS both under the DTAA as well as under Expln.-2 to Sec.9(1)(vii) of the Act has already been referred to earlier - it refers to a payment in consideration for the services of managerial, technical or consultancy nature - The payments received by the Assessee are for providing a facility to its agents - The payment received is nothing but a payment by way of reimbursement of the cost for providing a particular facility - The Assessee is in the business of shipping and not in the business of providing any technical service – There is no finding by the AO or CIT(A) that there was a profit element embedded in the payments received from the Assessee from its agents in India - Installation and operation of sophisticated equipments with a view to earn income by allowing customers to avail of the benefit of the use of such equipment does not result in the provision of technical service to the customer for a fee – the order of the CIT(A) is upheld in deleting the addition made by the AO on account of amount received by the assessee towards shared IT Global Portfolio Tracking System by treating the same as fees for technical services – Decided against revenue.
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