9911796707
TMI Blog2010 (1) TMI 633X X X X Extracts X X X X X X X X Extracts X X X X ..... A) erred in holding that the amount of Rs.71,11,594/- received for supervision during start up and commissioning is not chargeable to tax as there is no PE of the assessee in India during the year under consideration." 3. The facts which reveal from the record are as under : The assessee is a foreign company, who filed the return of income declaring the total income at Rs. 67,52,000/-. The return filed by the assessee company was selected for scrutiny and the assessment was made u/s. 143(3) of the Act. The assessee company provides plant and equipment, technical know-how, engineering services as well as renders services for erection and commissioning of plants. The assessee has rendered following services : i) Supply of Technical Know-how ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om supervisory activity in connection with any construction, installation or assembly of project is to be treated as income of the Permanent Establishment (P.E), if such supervisory activity continues for a period exceeding six months. The operative part of the findings are as under : "4.2 As regards the taxability of supervision charges amounting to Rs.71,11,594/-, I agree with the contention of the appellant that under the new treaty which was brought into force on 26/10/1996, which is applicable from the F.Y. 1997-98 (A.Y. 1998-99), the appellant's income from supervisory activity in connection with any construction, installation, assembly projects are to be treated as income of the 'Permanent Establishment (PE), if such supervisory act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... installation of the plant cannot be treated as income of the P.E. As the income as admitted by the A.O. that there is no P.E. of the assessee, there is no question for treating the income towards supervision, erection and commissioning of the plant as an income of the assessee taxable in India. The view taken by the Ld CIT(A) is correct. We, therefore, confirm the same and accordingly, dismiss the Ground taken by the Revenue. 5. Now we take up the assessee's appeal being ITA No. 4652/Mum/2005 in which there are following two effective Grounds : "2. That the learned CIT(A) has erred in confirming that amount received by the assessee for the "supply of engineering and documentation", "technical know-how", was liable to tax as fee for techn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o supply of plant and equipment and has to be treated as business income within the meaning of Articles 7 of DTAA between India and Germany. 6. The Ld D.R. supported the order of the authority below. 7. On the rival submission, we find that in respect of the supply of technical know and supply of engineering and documentation, the assessee was consistently offering the said income for taxation treating the same as royalty/fees for technical services. Though the Ld Counsel argued that both the services are part of the composite contract and incidental to the supply of the plant and equipment but nothing has been placed before us to support the said contention like agreement between the parties. In the preceding years, the assessee himself ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
