TMI Blog2016 (11) TMI 658X X X X Extracts X X X X X X X X Extracts X X X X ..... of hearing, it was a common point between the parties that the facts and circumstances in relation to the said dispute are similar in all the assessment years, therefore, appeal of the assessee for Assessment Year 2003-04 is taken as lead case in order to appreciate the controversy. ITA NO. 2619/MUM/2014 (A.Y : 2003-04) 3. This appeal by the assessee is directed against the order of CIT(A)-10, Mumbai dated 08.11.2013, pertaining to the Assessment Year 2003-04, which in turn has arisen from the order passed by the Assessing Officer, Mumbai under section 144C(3) r.w.s. 147 r.w.s. 143(3) of the Income Tax Act, 1961 (in short the Act ). 4. Briefly put, the relevant facts are that the appellant is a tax resident of Ireland and is engaged in the business of distributing Gartner group s research products in the form of subscription, both in Ireland and through distributors in territories where Gartner group does not have a local presence. The research products of the assessee entail qualitative research and analysis which aids decision-making for information technology buyers, users and vendors. Assessee-company sells its subscription to Indian customers/subscribers by prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the order of Tribunal dated 24.7.2013 ( supra ) is relevant :- 4. We have heard the rival submissions and perused the relevant material on record. At the very outset, the learned Departmental Representative relied on the judgment of the Hon ble Karnataka High Court in the case of CIT (IT) v. Wipro Limited [(2011) 203 Taxman 621 (Kar.)] and submitted that Wipro Limited, a customer of the present assessee made payment without deduction of tax at source u/s 195 of the Act. When the matter finally came up before the Hon ble Karnataka High Court, it was held that the payments made by Wipro Limited to Gartner for online use of database was for licence to use said database and hence the consideration was royalty, liable for deduction of tax at source u/s 195 of the Act. 5. The learned AR countered the submissions advanced on behalf of the Revenue by stating that the issue as to whether the payment should be considered as `royalty or `business profits is not free from doubt in view of the conflicting judgments rendered by the Hon ble Karnataka High Court in the case of Wipro Limited (supra) and the Hon ble Delhi High Court in the case of Ericsson A.B. *(2012) 204 Taxman 192 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nataka High Court and it was a case where the issue related to the nature of payments made by M/s. Wipro Ltd. as a customer of the assessee-company; and secondly, that subsequently the Hon ble Delhi High Court in the case of Infrasoft Ltd., 39 Taxmann.com 88 (Delhi) has examined payment of a similar nature and found it to be not in the nature of royalty after specifically dissenting from the view of the Hon ble Karnataka High Court. It has been canvassed that the aforesaid development has taken place after the decision of Tribunal in assessee s case for Assessment Year 2007-08 on 24.7.2013 ( supra ) and, therefore, under the changed circumstances, the later view represented by the decision of Hon ble Delhi High Court in the case of Infrasoft Ltd. (supra) be preferred, which ostensibly supports the plea of assessee that impugned sums are in the nature of business receipts not taxable in India in the absence of any permanent establishment or fixed place of business. In this regard, it is pointed out in the case of M/s. Capgemini Business Services (India) Ltd., ITA No. 7779/M/2011 dated 29.2.2016 the Mumbai Bench has followed the decision of Hon'ble Delhi High Court in prefere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has not undergone a change and we find no reason to depart from the earlier stand of the Tribunal in assessee s own case for Assessment Year 2007-08 (supra). The reliance placed by learned representative on the subsequent decision of Hon ble Delhi High Court in the case of Infrasoft Ltd. (supra), in our view, does not justify departure from the decision of Tribunal dated 24.7.2013 (supra) because the decision of Hon ble Karnataka High Court in the case of Wipro Ltd. (supra) is specific to the transaction before us, albeit in the hands of the payer of such income. Therefore, as per principles of judicial consistency and considering that the decision of Tribunal dated 24.7.2013 (supra) has not been altered by any higher authority, we deem it fit and proper to decide the issue in favour of Revenue and against the assessee. Thus, following the precedent, stand of the Revenue is upheld and assessee fails. The plea of the learned representative before us, based on the judgment of Hon'ble Supreme Court in the case of Vegetable Products Ltd., 88 ITR 192 (SC), that where two views are possible, one that is favourable to the assessee should be preferred, is also not acceptable. This ..... X X X X Extracts X X X X X X X X Extracts X X X X
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