TMI Blog1994 (5) TMI 46X X X X Extracts X X X X X X X X Extracts X X X X ..... nd further erred in directing that provisions of s. 145 were not applicable for determining the total income of the assessee. 2. We have heard the parties to the dispute. Assessee is a foreign company and had entered into an agreement for rendering among other things, technical services to the following companies, viz.: (i) Punjab Alkalies (ii) Modi Alkalies (iii) Kothari Madras (iv) Guj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... we are of the view, that the order passed by the CIT(A) does not suffer from any legal infirmity. There cannot be any dispute that where there is a conflict between the agreement for avoidance of double taxation and the domestic laws relating to taxation of income arising in the Contracting State, the former has to prevail. We have also been informed by the assessee, that in the past, fees for tec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person. If we read cl. 3, which defines the term "royalties" and cl. 4, as observed earlier, which defines the term "fees for technical services" together, there cannot be any doubt that what is taxable is payment received by a person of the other Contracting State. Though under s. 5(2)(b) of the IT Act, in the case of a non-resident, income which accrues or arises or deem to accrue or arises to h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the double taxation avoidance agreement between India and the Federal Republic of Germany, as there was no occasion to do that. It has merely explained the scope of s. 5(2)(b) of the IT Act and we have already observed earlier that there is apparent conflict between the provisions of s. 5(2)(b) of the IT Act and art. VIIIA of the treaty for avoidance of double taxation and we have also adverted to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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