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2023 (8) TMI 1372 - AT - Income TaxRevision u/s 263 - taxability of the income received by the assessee on off shore supplies made to DMRC and the engineering services provided to BTIN with reference to the DTAA between India and Thailand - As per CIT engineering services provided by the assessee to Bombardier Transportation India Limited (BTIN) falls under the definition of ‘royalty’ and, therefore, the assessment order passed by AO was erroneous and prejudicial to the interest of Revenue - HELD THAT:- As noticed that while completing assessment of the assessee for the assessment years 2013-14 to 2015-16 and also for the immediately succeeding assessment year to the assessment year under consideration i.e. 2017-18 the AO thoroughly examined the taxability of the income received by the assessee on off shore supplies made to DMRC and the engineering services provided to BTIN with reference to the DTAA between India and Thailand and the conclusion was drawn by the AO that these incomes are not taxable. This consistent approach was departed by the Revenue for the assessment years 2016-17, 2018-19 and 2019-20 for one reason or the other, which, in our view, is not justified. The ratio of the decision of Radhasoami Satsang [1991 (11) TMI 2 - SUPREME COURT] wherein the apex court rejected the plea of the Revenue that res judicata does not apply to tax matters and held that where the facts are identical there is no change in law, the judicial authorities are bound by the decision of the previous year applies to the present case. Therefore, on this ground alone we direct the AO to delete the addition made towards off shore supplies and also for providing engineering services accepting the stand of the assessee that they are not taxable under DTAA between India and Thailand. Even on merits the case of the appellant is covered by the decision of the Tribunal in assessee’s group company, namely, Bombardier Transportation Sweden AB Vs. DCIT [2020 (10) TMI 1205 - ITAT DELHI] held that appellant does not have any place of business in India and all business activities with respect to offshore supplies are carried outside India. The equipment supply has been manufactured at overseas manufacturing facility of the appellant and sale of equipment has occurred outside India and payment has also been received by the appellant and outside India. Thus, even on merits the addition made towards off shore supplies is liable to be deleted.
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