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2016 (1) TMI 36 - ITAT MUMBAI

2016 (1) TMI 36 - ITAT MUMBAI - [2015] 43 ITR (Trib) 506 (ITAT [Mum]) - Entitlement for benefit of Indo-UK Double Taxation Avoidance Agreement - the assessee filed return of income as representative assessee of a firm of solicitors based in UK, named "Millbank Tweed Hadley and Mccloy". M/s. Zee Telefilms Ltd. had engaged the abovesaid solicitor for its proposed ADR offering. M/s. Zee Telefilms Ltd. paid fees to the solicitors and deduced tax at source of ₹ 70.16 lakhs. Later it filed retur .....

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visions of UK.

Thus we hold that the assessee is entitled to Indo-UK Double Taxation Avoidance Agreement benefits and accordingly dismiss the appeal filed by the Revenue. - Decided against revenue - I. T. A. No. 6245 /Mum/ 2008 (assessment year 2001-02). - Dated:- 9-10-2015 - B. R. BASKARAN (Accountant Member) and PAWAN SINGH (Judicial Member) Shridhar E. for the appellant. Sanjiv M Shah for the respondent. ORDER The order of the Bench was delivered by 1. B. R. Baskaran (Accountant M .....

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sident of UK ; 2. On the facts and in the circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) erred in holding article 15 of the Indo-UK treaty will be applicable as against the taxability of the receipts as per domestic law of India since the partnership is not a person as per article 3(f) of the Indo-UK treaty ; 3. The appellant prays that the order of the learned Commissioner of Income-tax (Appeals), Mumbai on the above grounds be set aside and the order of .....

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Tweed Hadley and Mccloy". M/s. Zee Telefilms Ltd. had engaged the abovesaid solicitor for its proposed ADR offering. M/s. Zee Telefilms Ltd. paid fees to the solicitors and deduced tax at source of ₹ 70.16 lakhs. Later it filed return of income as a representative of the abovesaid solicitors' firm declaring the total income as nil. Accordingly, the entire amount of TDS deducted by M/s. Zee Telefilms Ltd. was claimed as refund. The Assessing Officer noticed that a partnership firm .....

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citors' firm is in the nature of "fee for technical services". Accordingly, the Assessing Officer computed the income of the assessee at ₹ 2.85 crores. 5. In the appellate proceedings, the learned Commissioner of Income-tax (Appeals) held that the fees received by the assessee-solicitors' firm does not fall in the category of fee for technical services, but it would fall under the category of fee of independent personal services. Since the period of stay of the lawyers, w .....

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of Indo-UK treaty to the assessee. 6. Before us, the learned authorised representative placed reliance on the decision rendered by the hon'ble Calcutta High Court in P and O Nedlloyd Ltd. v. Asst. DIT (International Taxation) on November 7, 2014 in W.P. No. 457 of 2005 and W.P. No. 458 of 2005 [2014] 369 ITR 282 (Cal) and submitted that the hon'ble High Court has held that the benefit of Indo†UK treaty is available to the partnership firms formed in UK also. The learned aut .....

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not bring to our notice any contrary decision. 8. We notice that the hon'ble Calcutta High Court has expressed the view that the benefit of Indo†UK treaty is available to the partnership firm registered in UK even though the firm is not recognised as taxable entity under the taxation provisions of UK. For the sake of convenience, we extract bellow the relevant discussion made by the hon'ble High Court of Calcutta in the abovesaid case : "It is the other objection regar .....

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both of the Contracting States. Article 3-General Definitions 1(f) the term 'person' includes an individual, a company and any other entity which is treated as a taxable unit under the taxation laws in force in the respective Contracting States, but, subject to paragraph 2 of this article, does not include a partnership: 1(h) the terms 'enterprise of a contracting state' and 'enterprise of the other contracting state' mean respectively an enterprise carried on by a resid .....

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esidence, place of management or any other criterion of a similar nature. Article 9-Shipping 1. Income of an enterprise of a Contracting State from the oper ation of ships in international traffic shall be taxable only in that State.. . . 5. The provisions of this Article shall apply also to income derived from participation in a pool a joint business or an international oper ating agency.' The effect of the relevant provisions of the India-UK Treaty as reproduced above is that the conventio .....

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