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2017 (6) TMI 282 - AT - Income TaxFees for technical services - made available or not - payments made to the M/s University of Calgary, Canada (non-resident) in terms of contract dated 23.06.2008 for long term collaboration, participation, training, maintenance of air injection equipment - Receipts taxable in India - India-Canada DTAA - Held that:- We agree with the findings arrived at by the AO and the CIT(A) that the know how possessed by the non-resident appellant has been shared and made available to the ONGC personnel. The same is evident from clause 1.2 of the scope of project extracted herein above. The contention of the Ld. AR that the technology is not made available to ONGC is incorrect as the agreement not only contemplates participation but also training and collaborative research between the personnel of the non-resident and ONGC. Article 12(4) of the DTAA thus becomes applicable in the present facts and circumstances of the case. In view thereof, Ground No.1 raised by the appellant is dismissed. Receipts taxable under section 44BB - Held that:- The appellant has no PE in India. Section 44BB of the Act applies in a case where consideration is for services relating to exploration activity which are not in the nature of technical services. If, the consideration is in the nature of fee for technical services, the provisions of either section 44DA or section 115A will be applicable. The said position remained same even after the amendment brought by Finance bill 2010. The agreement shows that the personnel of the non-resident are not engaged in extraction or production of mineral oils. The appellant is not receiving any consideration for mining, assembly or other like projects undertaken by it. Thus, the appellant falls within the purview of Explanation 2 of Section 9(1)(vii) of the Act. The judgment of the Apex Court in ONGC Vs. CIT (2015 (7) TMI 91 - SUPREME COURT) is not applicable to the present case as in that case the non-resident recipient of income was engaged in drilling operations. The facts of this case are distinguishable. We agree with the reasoning given by the AO and CIT(A) and in view thereof, Ground no. 2 raised by the appellant is dismissed. - Decided against assessee.
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