2014 (1) TMI 1405

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....tober, 2012, the following substantial question of law was framed:-      "Whether the Tribunal in the impugned order is in error of law to hold that the amount paid by the assessee to Panamsat International was liable for deduction of tax by virtue of Section 195 read with Section 9(1)(vi) of the I.T. Act, 1961." 3. The reasoning given by the Tribunal in paragraph 5 of the impugned order for deciding the issue in favour of the respondent-assessee reads as under:-      "5. We have heard both the sides. We would like to state that the details of the payments made to PANAMSAT/Intel Corporation during the relevant period have been filed in the paper book at page 6 and from this, it is clear that ....

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....elhi High Court in Asia Satellite Telecommunications Co. Ltd. v. DIT [2011] 332 ITR 340. Reference has been made to then Section 9(1)(vi) and the view taken by the Delhi High Court that the payments made for providing data transmission services through provision of space segment capacity or satellites did not constitute royalty within the meaning of the said Section. 5. Section 9(1)(vi) was subsequently amended and Explanations 5 and 6 were inserted by Finance Act, 2012 with retrospective effect from 1st June, 1976. The said Explanations read:-      "Explanation 5.- For the removal of doubts, it is hereby clarified that the royalty includes and has always included consideration in respect of any right, property or ....

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....to any income by way of fees for technical services payable in pursuance of an agreement made before the 1st day of April, 1976, and approved by the Central Government." 6. In an appeal under Section 260A of the Act, we are not required to consider the constitutional validity and vires of the said amendments but have to apply the amended provision. In view of the said statutory amendments, the reasoning given by the Tribunal cannot be sustained and has to be reversed. 7. Learned counsel for the respondent-assessee has, however, rightly drawn our attention to the assessment order in which the assessee had also pleaded and submitted that the payments made cannot be Considered as royalty or fee for included services as defined in Double ....