9911796707
TMI Blog2015 (8) TMI 357X X X X Extracts X X X X X X X X Extracts X X X X ..... y the ld. Assessing Officer ("AO") is bad in law and void ab-initio." 3. At the time of hearing before us, it is stated by the learned counsel for the assessee that this ground is of general nature and should be treated as not pressed. Accordingly, the same is rejected being not pressed. 4. Ground No.2 of the assessee's appeal reads as under:- "That on the facts and in the circumstances of the case and in law, the ld. AO/Ld. DRP has erred in applying tax rate of 15 per cent on 'Fee for technical services' ("FTS") under Article 12 of the India-USA DTAA on training services rendered by the appellant, ignoring the fact that section 115A of the Act provides for beneficial tax rate of 10% (exclusive of surcharge/cess) on FTS." 5. At the time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her submitted that the assessee has a PE in India and, therefore, Section 115A is not applicable in the case of the assessee. 7. In the rejoinder, it is stated by the learned counsel that the decision of Goetze (India) Ltd. (supra) relied upon by the learned DR would not be applicable because the above decision was with regard to the claim of some expenses which was made by the assessee before the Assessing Officer without filing the revised return. In that context, Hon'ble Apex Court held that the assessee ought to have filed the revised return for making any additional claim of expenses. That in this case, the assessee is not claiming any additional expenses but assessee is only disputing the rate of tax. The rate of tax applied by the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... spute is with regard to the rate of tax and the assessee rightly pointed out that the issue of rate of tax arose only after the receipt of the assessment order. Moreover, it is the duty of the Assessing Officer to charge the tax at the correct rate. Therefore, in our opinion, the assessee can agitate for the first time before the ITAT the issue regarding the rate of tax in respect of fee for technical services. 9. Section 90, sub-section (2) reads as under:- "(2) Where the Central Government has entered into an agreement with the Government of any country outside India or specified territory outside India, as the case may be, under sub-section (1) for granting relief of tax, or as the case may be, avoidance of double taxation, then, in re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax rate of 10% in respect of fees for technical services. This being a more beneficial provision than the Article 12 of DTAA, therefore, assessee had a right to claim the applicability of this provision of the Income-tax Act in view of the provision of Section 90(2) of the Income-tax Act. We, therefore, direct the Assessing Officer to apply Section 115A(BB) and tax the fees for technical services at the rate of 10%. 12. Ground No.3 reads as under:- "That on the facts and in the circumstances of the case and in law, the ld. AO has erred in not granting credit for tax deducted at source ('TDS') amounting to Rs. 36,98,688 while issuing notice under section 156 of the Act read with the assessment order under section 143(3)/144C(13) of the Act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on protective basis. The learned counsel for the assessee stated that at present, the assessee is not disputing the protective assessment of the income of this year. His only prayer is the direction to the Assessing Officer for non-recovery of the tax on protective addition. 16. After considering the arguments of both the sides, we agree with the contention of the learned counsel. It is a settled position of law that the Revenue cannot insist on recovering the tax on protective assessment of income. We, therefore, set aside this matter to the file of the Assessing Officer and direct him not to recover the tax on protective addition. 17. In the result, the appeal of the assessee is partly allowed. Decision pronounced in the open Court ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
