TMI Blog2008 (10) TMI 257X X X X Extracts X X X X X X X X Extracts X X X X ..... ource for payment of training fee to the said company. In the appeal filed by the assessee, the CIT(A) confirmed the order of the AO in respect of all the four appeals, and now the assessee is in further appeal before us. 3. It was contended by the learned Authorised Representative Shri M.P. Rastogi that assessee had entered into an agreement with M/s Corus Consulting Ltd., UK for imparting training to the assessee's personnel at steel plant in their country and the training fee was to be paid by the assessee company in pursuance of this agreement. He contended that since training was to be imparted outside India and neither any part of the training was to be given in India nor any personnel of the said company was to visit India in connection with training there was no reason for treating the services rendered with respect to training as "fee for technical services". He further argued that training was in the nature of refresher course and education, it was not related to any design, drawing, know-how being made available to the assessee for use in the business in India, accordingly, training fee was not in the nature of fee for technical services in terms of art. 13(4)(c) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of steel and steel products carrying out business since the last more than 20 years. The services as provided by Corus Consulting Ltd. were basically in the field of appreciation of management practices and procedure employed in Corus to have a general understanding about the practices employed by Corus in their plant as well as presentations and discussions with attachment to counterpart Corus specialists and managers. 5. On the other hand, it was contended by the learned Departmental Representative Miss Kakkar that as per art. 13 of DTAA, which deals with the royalty and fee for technical services arising in a Contracting State and paid to a resident of other Contracting State, may be taxed in that other State. For the purposes of this article, the term 'royalties' means (a) payments of any kind received as a consideration for the use of, or the right to use, any copyright of a literary, artistic or scientific work, including cinematograph films or work on films, tape or other means of reproduction for use in connection with radio or television broadcasting any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, comme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the term "technical" should receive broad interpretation to include professional services as well. Reliance was placed on the decision of Delhi High Court in case of Holtec Engineers (P) Ltd. vs. CBDT (1980) 14 CTR (Del) 53 : (1979) 120 ITR 696 (Del). As regards the nature of technical services being provided by Corus consulting to personnel of assessee was argued to be in the nature of that stated in art. 13 of UK DTAA r/w s. 9(1)(vii) of IT Act, 1961. 7. We have considered the rival contentions, carefully gone through the orders of authorities below and also the written submissions placed on record by the learned Authorised Representative and learned Departmental Representative. We had also deliberated on the case laws cited by the learned Authorised Representative and learned Departmental Representative during the course of hearing before us in the context of factual matrix of the case. We had also gone through the various clauses of the agreement entered into by the assessee with M/s Corus Consulting Ltd., UK for imparting training to assessee's engineers/managers at steel plant in that country and the training fee paid for the same. In the order issued under s. 195, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, including granular coal injection. For each area there will be inputs on: Key performance indicators; Process parameters, measurement, tests, analysis and interpretation; Process control systems and automation; Quality assurance; Management information systems; Cost control; Organization, personnel training and development; Standard operating procedures; Refractories Standard maintenance procedures; Environmental factors; Energy recovery and distribution; Support services and contractors Steel making Including: Hot metal quality and treatment; Primary steel making (BOS process); Secondary steel making, ladle furnace, degassing, alloying; Refractories For each area there will be inputs on: Key performance indicators; Process parameters, measurement and quality assurance; Process control systems and automation; Management information systems; Cost control; Organization, personnel training and development; Standard operating procedures; Standard maintenance procedures; Environmental factors; Energy and waste recovery; Support services and contractors. Rolling mills and finishing processes: For each area there wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quired by the personnel of the assessee company as a result of services rendered by Corus Consulting Ltd. in the form of training were to be used in the business of the assessee which is carried on in India; the training fee paid by the assessee was the income of Corus Consulting Ltd. by way of fee for technical services which is deemed to accrue and arise in India under s. 9(1)(vii) of the Act, therefore, chargeable to tax in terms of provisions of s. 5(2) of the Act. The term 'fee for technical services' has also been defined in art. 13(4)(c) of DTAA to mean, inter alia, payment of any kind to any person in consideration for tendering of any technical services which make available technical knowledge. experience or skill. After getting the training from Corus Consulting Ltd. the employees of the assessee company were to make available technical knowledge, experience and skill, to use and implement the technical expertise so acquired for improving the operational performance of the steel plants of the assessee in India, therefore, the training fee by assessee was in the nature of fee for technical services under DTAA, in terms of art. 13(4)(c). Article 13(2) of DTAA grants taxatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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