TMI Blog2017 (11) TMI 1846X X X X Extracts X X X X X X X X Extracts X X X X ..... ance tax and corresponding levy of interest u/s. 234B of the Act does not arise. - Decided in favour of the assessee - I.T.A. No.195/Mum/2016 - - - Dated:- 7-11-2017 - SHRI SHAMIM YAHYA, AM AND SHRI SANDEEP GOSAIN, JM For The Appellant : None For The Respondent : Shri Samuel Darse ORDER Per Shamim Yahya, A. M.: This appeal by the assessee is directed against the order by the Disputes Resolution Panel-1, Mumbai dated 29.09.2015 and pertains to the assessment year (A.Y.) 2012-13. 2. The grounds of appeal read as under: Ground No. 1: Erroneous treatment of Business Income as Royalty Income On the facts and circumstances of the case and in law, the Ld. DCIT has erred in treating and further the Hon'ble DRP has erred in confirming entire payments received by the Appellant during the captioned year are taxable as royalty under Section 9(l)(vi) of the Income-tax Act, 1961 and under Article 12 of India Ireland Double Taxation Avoidance Agreement. Ground No. 2: Erroneous levy of interest under Sections 234B of the ₹ 1,49,59,032 On the facts and circumstances of the same and in law, the Ld. DCIT has erred in levying interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to access Gartner's research products over the internet from its data server which is located outside India. Research subscriptions were originally delivered through print media and other physical means of delivery, however, most clients now access research products over the internet at www.gartner.corn. GIL enters into a Service Agreement (hereinafter referred to as 'SA') with its India customers/subscription for each Gartner service purchased, setting out the details of the service to be provided and the subscription fee applicable. The Indian subscribers pay the subscription/access fees to GIL in accordance with the SA. During the year, the assessee has received a gross subscription fee of ₹ 77,61,64,930/- from number of Indian clients. 5. During the course of the assessment proceedings, show cause notice was issued to the assessee to show cause as to why income from subscription fees should not be treated as 'Royalty' and held taxable in India on the lines of earlier assessment year (i.e., A.Y. 2011-12). The assessee contended that the income earned by it from selling the subscription of publications cannot be treated as Royalty but should be trea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee fell in the ambit of royalty and is taxable under the Act/DTAA. The Assessing Officer, therefore, held that subscription fees received by Gartner for licence to use the said database maintained by Gartner is royalty and is taxable as per the provision of section 9(1)(vi) of the Income Tax Act, 1961 read with Article 12 of the DTAA between India and Ireland. Accordingly, the Assessing Officer brought to tax the subscription fees of ₹ 77,61,64,930/- in the hands of the assessee by holding the same to be in the nature of 'royalty'. It is against this action of the Assessing Officer that the assessee has filed the objection. 7. Upon the assessee s objection, the ld. DRP held as under: We have considered the facts of the case and submissions made by the assessee. We find that the issue is covered against the assessee by the decision of the Hon'ble ITAT Mumbai Benches L , Mumbai in assessee's own case in ITA No.7101/Mum/2010 for the A.Y. 2007-08 dated 24.07.2013 on identical facts. In their order, the Hon'ble ITAT has held as follows:- 4. We have heard the rival submissions and perused the relevant material of record. At the very ou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . We are unable to see as to how the contrary view expressed by the Tribunal in three orders can be adopted in the case of the payee-assessee, when the Hon'ble Karnataka High Court has rendered judgement on the very same transaction in the hands of the payers. If the argument tendered by the Ld. AR is accepted, it would amount to delivering an opinion contrary to that of the Hon'ble High Court, which is obviously out of question. We, therefore, do not find any substance in the arguments put forth by the Ld. AR. The impugned order is upheld. 7. In the result, the appeal is dismissed . 2.7 Respectfully, following the order of the Hon'ble ITAT as above in assessee's own case, we uphold the draft assessment order of the Assessing Officer and hold that the amount of ₹ 77,61,64,930/- is taxable in India. The objection filed by the assessee on this issue is rejected and dismissed. 8. Upon careful consideration, we find that this Tribunal in the assessee s own case in ITA No. 497/Mum/2015 for assessment year 2011-12 vide order dated 12.04.2017 has decided the same issue by holding as under: 3. Apropos ground no. 1 3.1 On this issue at the o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplicable to the facts of the assessee's case. 3.4 We have carefully considered the submissions and perused the records. We find that this tribunal has consistently decided the issue against the assessee in earlier assessment years. The assessee is in appeal before the Hon'ble High court. Now the Ld. Counsel of the assessee is pleading that there is a Bombay High court decision according to which the issue should be decided in favour of the assessee. This decision was said to have been not cited before the tribunal earlier on several occasions by mistake. We note that assessee has not filed any miscellaneous petition for recall of the earlier Tribunal order on the ground that the said decision is contrary to the jurisdictional High Court decision which was available on the date of the tribunal orders. 3.5 Furthermore we note that h the above case said of Dun and Bradstreet (supra) Hon'ble jurisdictional High Court has followed the decision of Authority for Advance Ruling in the case of Dun and S.A. Bradstreet Espana by holding that: the assessee did not attract the provision of section 195 of the Act as the assessee was engaged to the very same business info ..... X X X X Extracts X X X X X X X X Extracts X X X X
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