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TMI Blog2011 (3) TMI 1240X X X X Extracts X X X X X X X X Extracts X X X X ..... ories of patent, invention, design or registered trade-mark as envisaged by section 80-0. 5. On appeal, the learned CIT (Appeals) observed that in earlier years question of deduction u/s.80-0 was set aside by the Tribunal and, therefore, the same was open and he made detailed examination of the same. In respect of claim for deduction u/s.80 RRA it was observed that since there was a requirement for approval of the terms and conditions of services provided outside India, and since no such approval was granted, the assessee was not eligible for deduction u/s.80 RRA in respect of deduction u/s. 80-0. He decided the issue against the assesee vide para 5.7 to 5.9 of CIT (Appeals) order which is as under:- "5.7 If we read Sec. 80-0 in contradistinction to Sec. 80RRA, it is apparent that deduction u/s.80-0 is not available to just any technician. The heading of Sec. 80-0 is "Deduction in respect of royalties, etc., from certain foreign enterprises" as against heading in the case of Sec. 80RRA which is "Deduction in respect of remuneration received for services rendered outside India." 5.8 From the plain reading of the respective sections, it is clear that deduction u/s. 80 0 is o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provided following services:- "1. Tropicallising of electronic circuitry. 2. Developed software which led to controlling loss of material, especially because the raw materials used were diamonds. 3. By applying new ideas and subsequent implementation of optical changes which led to narrowing down the laser beam. 4. He made drastic changes in the technology in colling of lasers which helped in saving a lot of electric power consumed by the laser machines. 5. He re-routed the electric connections into three areas of importance and used low power UP sec to protect the equipments and saved a lot in maintenance cost." 8. He submitted that even when a design was supplied, the same was held to be eligible for deduction u/s.80-0. In this regard, he referred to Hon'ble Bombay High Court in case of CIT vs. Charles M. Correa [2010] 323 ITR 174, wherein deduction u/s.80-0 was held to be liable even to as Architecture for providing technical services. Similarly, deduction was held to be liable by Chennai bench of the Tribunal in case of Ontrack Sstems Ltd. vs. ACIT [2007] 108 ITD 279, where assessee was a Computer Engineer and had approval of services for designing web sides. 9. On the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Central Government or any State Government, only if such service is sponsored by the Central Government; (ii) in the case of any other individual, only if he is a technician and the terms and conditions of his service outside India are approved in this behalf by the Central Government or the prescribed authority." Thus it is clear that as per clause (ii), sub section (2) in case of an assessee who was not an employee of Central Government or State Government, then his technical services has to be approved by the Central Government. Admittedly such service where not approved and this fact further become clear from the letter dated 07.06.2005 issued by Minister of Finance, Department of Revenue, Central Board of Direct Taxes, through which approval was refused. 11. The contention of the learned counsel of the assessee is that such refusal was made because assessee had not travelled abroad and Hon'ble Bombay High Court had already held that no such foreign travel is required for the purpose of deduction u/s.80 RRA, sounds attracted. The careful pursuance of this judgement shows that incase of Taru Jethmal Lalvani vs. Secretary, Ministry of Finance (Supra), the assessee had moved ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titute of Technology and the second in respect of the Ismaili Centre, Toronto. Under the first contract in which the assessee was described as an associate architect, the assessee had to provide architectural and design services primarily in schematic and design development phases. Under the second contract where the assessee was described as a consultant, the assessee was required to assist the architect with the design for the construction of the project. In the present case, as the facts before the court would show that it has not been disputed that the assessee did as a matter of fact provide the designs. Nor is it disputed that the designs provided by the assessee were used outside India. Moreover, it is an admitted position that income in convertible foreign exchange was received by the assessee in India. Section 80-0, inter alia, contains the following requirements : (i) the gross total income of the assessee, being an Indian company or a person resident in India must include any income received by the assessee from the Government of a foreign state or a foreign enterprise ; (ii) the income must be received in consideration of the use outside India of any patent, invention, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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