TMI Blog2024 (2) TMI 450X X X X Extracts X X X X X X X X Extracts X X X X ..... patent, trade mark, design or model, plan, secret formula or process. It also cannot be for information concerning industrial, commercial or scientific experience. It also cannot be considered to be payment for use of or the right to use industrial, commercial or scientific equipment. Though, the AO has observed that IMEI number is a unique invention to track the mobile equipment and information concerning industrial, commercial or scientific experience, however, we are not convinced. The fact of the matter is, the assessee, as a global administrator has created a database of unique numbers, which in combination with other numbers to be provided by mobile manufacturers can be implanted in the mobile devices to identify and keep track of the device. It is further to be noted that a particular IMEI number can be provided to only one mobile equipment manufacturer and has to be implanted in a single mobile equipment. This fact also proves that there is no transfer of use or right to use of any copyright of literary artistic or scientific work or use or right to use of any commercial or scientific experience or equipment. The database of IMEI number can be compared with the regis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etwork provider and instruction to them so that particular IMEI number is put into the black list and thereafter cannot be used in GSM network, thereby preventing misuse of particular mobile phone. 5. As stated by the Assessing Officer, the assessee unites nearly 800 of the world s mobile operators as well as more than 200 companies in the broader mobile ecosystems, including handset makers, software companies, equipment providers, internet companies, media and entertainment organizations. The assessee also provides services in India, for which it has entered into an agreement with A.B. Mobile Standards Alliance Pvt. Ltd. (MSAI), wherein, MSAI provided certain facility to the mobile manufacturers such as information and guidance to log into GSMA IMEI database etc. As per the agreement, the assessee does not provide any service to MSAI. Rather, GSMA provides access to the database to MSAI, through which, Type Allocation Code (TAC) or IMEI can be generated and allocated to the mobile manufacturers. For providing such services to the Indian Mobile manufacturers, MSAI collects certain amount from them and after retaining 30% of the amount collected, transfers 70% to the assessee bec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel submitted, since there is no provision of service by the assessee to MSAI or any other customer in India, there is no question of payment towards royalty or FTS. There is just sharing of revenue between the assessee and MSAI. He submitted, the assessee does not charge any amount from MSAI for any service. Rather, the amount paid by MSAI to the assessee is just sharing of revenue firstly collected by MSAI and later on distributed between MSAI and the assessee. He further submitted that the fee received also cannot be treated as FTS, as the assessee is not providing any managerial, technical or consultancy services to MSAI or any other party in India. He submitted, under no circumstance, the amount received can be treated as royalty, as the payment received is not for use or right to use any copyright of literature or artistic or scientific work or motion picture films. Further there is no use or right to use any industrial, commercial or scientific equipment. He submitted, the assessee is just facilitating the IMEI number by providing TAC to the mobile manufacturer and preparing database of IMEI number. Thus, he submitted, the payment received will not fall either under sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... software, hardware or other materials provided to MSAI or having been generated by or on behalf of the GSMA, shall not operate as an assignment of such right by GSMA to MSAI. It further provides that any material made available by the GSMA or any third party on behalf of the GSMA under the agreement, may carry the GSMA s trademark and proprietary marks or such other logo or proprietary marks and MSAI will act in good faith and will not do anything to bring or threaten to bring the GSMA or the marks into disrepute, or to infringe upon, harm or contest the validity of the marks and MSAI agrees that it will not use any of the marks unless expressly and specifically permitted to do so in writing by the GSMA. 11. Thus, from the aforesaid facts, it is very much clear that the only service the assessee has provided to MSAI is, access to database maintained by it containing certain unique numbers, which in combination with some other numbers to be created by mobile equipment manufacturer would from the IMEI number to be implanted in the mobile device. For providing IMEI/TAC numbers, assessee and MSAI follow revenue sharing model of 70:30. The agreement makes it clear that MSAI will have ..... X X X X Extracts X X X X X X X X Extracts X X X X
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