TMI Blog2023 (8) TMI 1257X X X X Extracts X X X X X X X X Extracts X X X X ..... e RCITP all reports, analysis, tests, tables, plans, drawings or other documents in any form including electronic or printed form for the use of RCITP which enables RCITP to apply and use all these deliverables for its business purposes which specifies the conditions of sub clause (b) and (c ) of clause (4) of Article 12 of Indo Singapore DTAA. Thus, the payments received by the assessee from RCITP are fees for technical services falls under sub clause (4) of Article 12 of Indo Singapore DTAA. Lower authorities have rightly treated the amounts received by the assessee from RCITP as fees for technical services under Article 12 (4) of Indo Singapore DTAA and was rightly brought to tax at 10%. Decided against assessee. - Shri Narendra Kumar Billaiya, Accountant Member And Shri Challa Nagendra Prasad, Judicial Member For the Assessee : Shri Rony Antony, C. A.; For the Department : Shri Vizay B. Vasanta, [CIT] - D. R.; ORDER PER C. N. PRASAD, J. M. : 1. This appeal is filed by the assessee against the assessment order dated 23.07.2019 passed under section 143(3) read with section 144C(13) of the Income Tax Act, 1961 (the Act) pursuant to the dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the I.T. Act. It was further contended that the proposed remittance being payment towards technical services received would not be categorized as fees for included services as per Article 12(4) of the treaty as the services do not make any technical know-how, experience, skill know-how or process which enable the person acquiring the services to apply the technology contained therein. 5. However, not convinced with the submissions and contentions of the assessee the Assessing Officer held that from perusal of work order it is clear that the role of the assessee involved development and transfer of a technical plan and technical design to RCITP while applying or has applied into the final making of its building. The designs and plans are supplied by the assessee along with the transfer of the technical plan or design. RCITP also acquired the rights to apply into its project the technology enhancement the design or blue print. On analyzing the work order the Assessing Officer concluded that the said receipts get covered in the scope and ambit of the term fees for technical services as laid down in Article 12 of the Treaty. The Assessing Officer also concluded that the receipts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon ble Karnataka High Court in the case of CIT Vs. De Beers India Mineral Private Limited [(2012) 346 ITR 467 (Kar). 8. On the other hand, the ld. DR referring to page Nos. 99 to 101 of the work order dated 30.06.2015 containing various clauses submits that as per the work order the principal designer coordinate with the contractors and other third parties appointed by RCITP and integrate the services with the services and work rendered by various contractors and third parties to ensure an integrated project. Further referring to clause 2.9 of the work order the ld. DR submits that as per the said clause the principal designer the assessee grants RCITP a perpetual irrevocable non-exclusive royalty free fully paid-up right and license to use copy modified and prepare derivative works of the principal designers intellectual property rights incorporated in the deliverables for the use of the Reliance and its affiliates and third parties and, therefore, satisfies the condition of make available clause as per Article 12(4) of the Indo Singapore DTAA. The ld. DR, therefore, submits that the lower authorities have rightly brought to tax the fee received by the assessee from Rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... design, but excludes any service that does not enable the person acquiring the service to apply the technology contained therein. 10. As could be seen from the above sub clause (b) of clause (4) of Article 12 payments of any kind to any person in consideration for services of a managerial technical or consultancy nature (including the provision of such services through technical or other personnel) if such services make available technical knowledge, experience, skill know-how or process which enables the person acquiring the services to apply the technology contained therein shall fall under fees for technical services under Article 12(4)(b). Similarly under such clause (c) of clause (4) of Article 12 payments of any kind to any person in consideration for services of a managerial technical or consultancy nature (including the provision of such services through technical or other personnel) if such services consists of the developmental and transfer of a technical plan or technical design but excludes any service that does not enable the person acquiring the service to apply the technology contained therein shall be treated as fees for technical services. 11. The work order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e principal designer the assessee grants RCITP a perpetual irrevocable non-exclusive royalty-free fully paid-up right and license to use copy, modify and prepare derivative works of the principal designer intellectual property rights incorporated in the deliverables for the use of the deliverables by the RCITP and its affiliates and third parties engaged by RCITP in connection with the business operations of the RCITP and its affiliates. This clearly shows that the assessee is making available RCITP all reports, analysis, tests, tables, plans, drawings or other documents in any form including electronic or printed form for the use of RCITP which enables RCITP to apply and use all these deliverables for its business purposes which specifies the conditions of sub clause (b) and (c ) of clause (4) of Article 12 of Indo Singapore DTAA. Thus, the payments received by the assessee from RCITP are fees for technical services falls under sub clause (4) of Article 12 of Indo Singapore DTAA. Thus, the lower authorities have rightly treated the amounts received by the assessee from RCITP as fees for technical services under Article 12 (4) of Indo Singapore DTAA and was rightly brought to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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