TMI Blog2015 (10) TMI 930X X X X Extracts X X X X X X X X Extracts X X X X ..... ge in which it is to be translated. The translator is not contribution anything more to the text which is to be translated. He is not supposed to explain or elaborate the meaning of the text. Apart from the knowledge of the language, the translator is not expected to have the knowledge of applied science or the craft or the techniques in respect of the text which is to be translated. A bare perusal of Explanation 2 to Section 9(1)(vii), which explains "fees for technical service" and the dictionary meaning of the word "technical" makes it unambiguously clear that translation services rendered by the assessee are not technical services. Therefore, the payment made by the assessee to the non-resident translators would not fall within the scop ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal was unintentional. The delay occurred on account of miscalculation of the period of limitation in filing of the appeal. We are satisfied that the delay in filing of the appeal is not wilful. The delay occurred due to bonafide mistake as stated above. In the interest of justice, delay of 5 days in filing of the appeal is condoned and the appeal is admitted to be heard on merits. 3. The assessee-company is engaged in the business of providing translation services through Web. For the assessment year under consideration, the assessee filed its return of income on 29.9.2009 declaring total income of ₹ 52,76,148/-. The gross total income of the assessee was ₹ 2,52,54,656/-. The assessee claimed deduction under Section 10A of & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow have erred in coming to the conclusion that payments made for translation services are in the nature of fees for technical service. The ld. AR contended that the services rendered by the assessee to its clients are neither technical nor managerial in nature. The assessee is receiving work order from its clients around the world for translation of scripts from one language to an other. The assessee is getting the translations done from translators in India and overseas. The disallowance made under Section 40(a)(i) is with respect to payments made to foreign freelance translators. The non-resident translators are engaged through internet on first-cum-first basis, as well as competitive rates. They do not have permanent establishment in Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 40(a)(i) on account of non-deduction of tax at source on the payments made to nonresident translators. The authorities below have held translation services to be technical in nature. On the other hand, the contention of the assessee is that the payment for translation services to non-residents does not fall within the ambit of fees for technical, managerial or consultancy services . 7. Let us first understand the scope of the term technical services . The expression technical services has not been defined anywhere in the Act. However, fees for technical services has been defined in Explanation 2 to Section 9(1)(vii) of the Act, which reads as under:- Explanation (2) for the purposes of this clause, fees for tech ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, i.e. the language from which the text is to be translated, to the language in which it is to be translated. The translator is not contribution anything more to the text which is to be translated. He is not supposed to explain or elaborate the meaning of the text. Apart from the knowledge of the language, the translator is not expected to have the knowledge of applied science or the craft or the techniques in respect of the text which is to be translated. A bare perusal of Explanation 2 to Section 9(1)(vii), which explains fees for technical service and the dictionary meaning of the word technical makes it unambiguously clear that translation services rendered by the assessee are not technical services. Therefore, the payment made by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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