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2015 (11) TMI 1292 - AT - Income TaxTDS u/s 195 - taxability of payment made to M/s Liftech Consultants Inc., USA in India - CIT(A) treating assessee as assessee in default u/s 201 - Held that:- Going through the agreement for engineering services for procurement and other aspects as appearing in the assessment order, we find that the service to be performed by M/s Liftech Consultant Inc., USA was more of a reviewing the design. The power of review is something more than the power of supervision. However, it is something less than the development and transfer of services and design. When we say that there is a power to review, essentially it implies also the power to make suggestions, advice on the concerned topic and area but if there is something more than the suggestion given i.e. if there is a transfer of some development or design and the person reviewing it monitor such transfer of design and development, then it cannot be a simple power of reviewing. We find that the lower authorities have not examined as to whether the suggestions given by M/s Liftech Consultant Inc., USA would amount to major change or improvisation of the design or were limited to just pointing out the shortcomings or defects, whatever it may be, in the already settled and agreed design of the product. Further, we do not find any record to suggest that whether M/s Liftech Consultant Inc., USA not only given these suggestions but were also physically active and present to implement these suggestions. We, therefore, on this limited issue, set aside the matter to the file of A.O. to find out if M/s Liftech Consultant Inc., USA has just suggested the development or has physically made available its presence through its officials to see whether those development and suggestions were actually implemented. If it is only suggestions given, then it will be review but if the M/s Liftech Consultant Inc., USA has forwarded to implement those suggestions on behalf of the assessee and have improvised the design or brought any major change in the design, then such suggestions would amount to transfer of technical services and design, which would be more than the power of review and would attract Article 12 of the India-US DTAA Treaty. - Decided in favour of assessee for statistical purposes.
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