TMI Blog2022 (7) TMI 76X X X X Extracts X X X X X X X X Extracts X X X X ..... nce raised by the Assessing Officer, does not meet our approval. Appeal filed by the Assessing Officer is thus dismissed. - ITA No. 2286/Mum/2021 and CO No. 35/Mum/2022 - - - Dated:- 22-6-2022 - Pramod Kumar , Vice President And Amit Shukla , Member ( J ) For the Appellant : Milind Chavan For the Respondents : Paras Savla, Harsh Shah and Pratik Poddar ORDER Per Pramod Kumar, VP 1. This appeal has also the cross objection on directed against the order 23.09.2021 passed by the learned CIT(A) in the matter of assessment under section 143(3) r.w.s. 144C of the Income Tax Act, 1961, for the assessment year 2013-14. 2. We first take up the appeal filed by the Assessing Officer. 3. In the appeal filed by the Assessing Officer the following grievances are raised:- 1. The Ld. CIT(A) erred in relying on the judgment of Hon'ble ITAT in the of Viceroy Hotels when services provided by the assessee are more than advisory in nature and comes in purview of fee of included services as per Indo US DTAA. The appellant prays that the order of the Ld. CIT(A) on the above ground(s) be set aside and that of the Assessing Officer be restored . 2. The Ld. CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Make available technical knowledge, experience, skill, knowhow or processes or consist of the development and transfer of a technical plan or technical design. 31. Thus Article 12(4) emphasises on rendering any technical or consultancy services which are ancillary and subsidiary to the application or enjoyment of any right, property or information for which a payment is received or make available technical knowledge, experience, skill, know how or processes or consist of development and transfer of technical plan or technical design. The services rendered by Marriott do not fit into either of the categories defined in 12(4)(a) or 12(4)(b) since the services do not involve technical expertise nor does it make available any technical know-how plan, design etc. What is being done by Marriott is basically inspection of the hotel, reviewing the facilities, comparing the same with Marriott's standards and suggesting improvements/change wherever required to meet the Marriott standard. Generally speaking technology will be made available when the person acquiring the service is enabled to apply the technology. The fact that the provision of service may require tec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke. The service should aimed at and result in transmitting the technical knowledge, etc. so that the payer of services could derive an enduring benefit and utilise the knowledge or know-how in future on its own without the aid of the service provider. By making available technical skills or know how, the recipient of service will get equipped with that knowledge or expertise and be able to make use of it in future, independent of the service provider. In other words, to fit into the terminology 'fees for included services', the technical knowledge and skills etc., must remain with the person receiving the services even after the particular contract comes to an end. The services offered may be the product of intense technological effort and a lot of technical knowledge and experience of the service provider would have into it. But that is not enough to fall within the description of 'fees for included services'. The technical knowledge or skills of the provider should be imparted to and absorbed by the receiver so that the receiver can deploy similar technology or techniques in future without depending on the provider. For example, a prescription and an advise given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y to the foreign company as its income accruing in the hands of the assessee company. On appeal, the Appellate Assistant Commissioner held that even if the assessee company was to be treated as an agent within the meaning of section 163(1), there was no business connection within the meaning of section 9(1) of the Act so the income accruing to the non resident foreign company could not be assessed through as agent. That order was affirmed by the Tribunal. On a reference to the High Court of Patna, it was held that the sum of $ 7,000 was not the income with the foreign company had received in India or an income which had accrued to the foreign company within the meaning of section 5(2) of the Act and that the sum paid to the foreign company at London for technical advice given from London could not be attributed to the operation carried on in India. It was further held that there was no continuity between the business of the non resident and the activity in the taxable territories in respect of the income and, therefore, there was no business connection between the foreign company and the assessee company and the income could not be deemed to accrue or arise to the foreign company i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red facts of the case in the light of the applicable legal position. 7. We are of the view that once a coordinate bench of this Tribunal in assessess's own case comes to the conclusion that the amounts in question are not taxable in terms of the provisions of the applicable tax treaty and the findings of the co-ordinate bench still hold good in law, we have no reasons to take any other view of the matter than the view so taken by the coordinate bench. Learned CIT(A) was quite justified in the following a binding judicial precedent and no specific reasons have been pointed out to us either, for the said judicial precedent, which is binding on us as well, must be deviated from. In view of these discussions and bearing in mind entirety of the case we uphold the relief granted by the learned CIT(A) and decline to interfere in the matter. The grievance raised by the Assessing Officer, does not meet our approval. 8. In the result the appeal filed by the Assessing Officer is thus dismissed. 9. Learned counsel for the assessee fairly submitted that in the event of the order of the learned CIT(A) being confirmed on merits, the assessee does not wish to pursue the technical obje ..... X X X X Extracts X X X X X X X X Extracts X X X X
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