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2020 (11) TMI 733 - AT - Income TaxIncome accrued in India - Benefit of India-UK Tax Treaty - remunerations received by the assessee for rendering legal services - Whether assessee is having PE in India within the meaning of Article-5 of India – UK DTAA? - o that the income of the assessee is taxable under Article-15 of India – UK DTAA - HELD THAT:- Tribunal in a very categoric manner has held that the provisions of section -9 relating to ‘Fee for Technical Services’ does not apply to the case of assesse, hence, the assessee is entitled to the benefit of DTAA. The Revenue has not been able to place on record any contrary material. No material has been placed before us to show that the nature of transaction in the assessment year under appeal is different from the transactions in assessment year 2013-14. Respectfully following the decision of the Co-ordinate Bench, we hold that the provisions of India-UK DTAA would override the provisions of the Act in the instant case and the remuneration received by the assessee for providing legal services do not fall within the ambit of ‘Fee for Technical Services’ as defined in DTAA. Thus, ground No.13 to 15 and 19 to 25 read with ground nos. 8 to 12 of the grounds of appeal are decided in favour of the assessee. Whether the assessee has PE in India and the receipts are liable to be taxed as ‘Business Profits’? - HELD THAT:- A perusal of the draft assessment order and the assessment order shows that the assessee had furnished the details before the AO. However, the same were not examined by the Assessing Officer. The Co-ordinate Bench in assessment year 2013-14 in principle has accepted the contention of the assessee that if the employees/personnel of the assessee have not rendered services in India for a period exceeding 90 days during the relevant period then it has to be held that the assessee did not have a PE in India during the year under consideration. In principle we are inclined to decide the issue in favour of the assessee. However, for the purpose of factual verification of the employees stay in India during the relevant period, the matter is remanded to the Assessing Officer. The Assessing Officer after asserting the same shall decide the issue, accordingly. Applicability of Article 15 of India-UK DTAA - Provisions of Article 15 of India-UK DTAA would not apply to the assessee. Since, the facts in the assessment year under appeal are similar, we see no reason to take a divergent view. Following the order of Tribunal in assessee’s own case in the preceding assessment years, grounds of the appeal are allowed.
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