TMI Blog2018 (5) TMI 2077X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of Article 12(4), as nothing is made available by the Assessee to Max and also the Assessee does not have any P.E in India. Therefore the income so arising to the Assessee in India cannot be taxed under Article 7 as 'Business Profits . Appeal filed by the AO stands dismissed. - I.T.A. No. 412/Mum/2016 - - - Dated:- 2-5-2018 - S/Shri Rajendra, Accountant Member and Ram Lal Negi, Judicial Member For the Revenue : Shri Samuel Darse-CIT-DR. For the Assessee Shri Dhanesh Bafna. PER RAJENDRA, AM Challenging the directions, dated 23/11/2015, of the Dispute Resolution Pane l(DRP)-2, Mumbai the Assessing Officer(AO)has filed the present appeal. Assessee- is a non-profit educational entity set up in the United States ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The AO has proposed to treat 90% of the total receipts i.e. fees for services rendered, as taxable as Royalties as per Article 12(3) of DTAA and 10% of the total receipts as Fees for Included Services under the Article 12(4)(b) of the DTAA. He computed the total income of the assessee as under :- Nature of Income Amount (Rs.) Income from Royalties (90% of total receipts) 3,55,15,332 Income from Fees For Included Services ('FIS') (10% of total receipts) 39,46,148 Total Income 3,94,61,480 3. It was brought to our notice that the identical issue-i.e.taxing 90% of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Inc. (supra) supports the plea of the assessee that where the agreement between the parties provides that there was no economic consideration for right to use the name it cannot he said that any payment can be called royalty. So also the consideration paid in a lumpsum cannot be split as a part being in the nature of royalty and any part being in the nature of FIS as laid down in the case of Motorola Inc. (supra). The payment cannot be said to be FIS for the reason that nothing is made available by the Assessee to WHL and in this regard, the observations while deciding payments received by the Assessee from MAX would be equally applicable to the payments received from WHL also. We are of the view that the entire payment received by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unal has passed the order dated 22-02-2013 in the assessee's own case relating to AY 2004-05 in ITA No.791/Mum/2008 and JTA No. 1020/Mum/2008, wherein it has followed the orders passed by the co-ordinate benches from AY 2000-01 onwards. In assessment year 2004-05, the assessee had received fees from M/s Max India Ltd. for identical services rendered by the assessee for advisory services rendered. Identical view was taken in the case of receipts from Wokhardt Hospitals. The Tribunal in paragraph 13 and 14 of its order has held as under:- 13. Consistent with the aforesaid view taken by the Tribunal in Assessee's own case, we hold that the payments received from Max does not constitute FIS (Fee for Included Services) within the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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