TaxTMI 
TaxTMI 
2014 (7) TMI 221
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....ting to DM 7,15,000/is not a receipt of income accruing or arising to the Assessee by virtue of the provisions of section 9(1)(vi) of Income Tax Act 1961 ? (B) Whether on the facts and circumstances of the case and in law the Hon'ble ITAT is right in holding that the payments towards the supply of the equipments amounting to DM 13,30,000/are not in the nature of royalty as defined in section 9 of the Income Tax Act 1961 ? (C) Whether on the facts and circumstances of the case and in law the Hon'ble ITAT is right in holding that when the entire income received by the nonresident Assessee was liable to deduction of tax at source, no advance was payable by the Assessee and there was no question of interest chargeable u/s 234B ?" 4. At the outset and in all fairness Mr Pinto submits that the question No.(C) is concluded against the Revenue and in favour of the Assessee by the Division Bench judgment of this Court in the case of Director of Income Tax (International Taxation) v/s NGC Network Asia LLC, reported in (2009) 313 ITR 187 (Bom). 5. However, Mr Pinto....
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.... to Mr Pinto, the finding of the Tribunal for earlier years does not bind the Revenue. Mr Pinto therefore submits that the Appeal be admitted. 7. On the other hand, Mr Pardiwalla, learned Senior Counsel appearing on behalf of the Respondent, submits that the findings recorded by the Tribunal are pure findings of fact. They are based on the factual materials. The Tribunal has followed its order for the earlier Assessment Years in relation to identical transaction and identical contract. There is nothing by which this Court can take a different view on facts. Further, the widest possible of the meaning 'royalty' does not include the handing over of any written guide or manual or giving information for the purposes of installation and use of the equipment at the site of the Indian resident. Mr Pardiwalla heavily relies upon the findings recorded by the Tribunal for the prior Assessment Years and submits that the Appeal does not raise any substantial question of law, it should be dismissed. 8. We have with the assistance of the learned counsel perused the order passed by the Tribunal. 9. The Tribunal in the case of the very Assessee, for prior assessment Years 1988-89 ....
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....the assessee in the cross objection and reject the ground of appeal raised by the revenue. In other words, even 10 % of these receipts treated by the learned CIT(A) as taxable would not be sustainable. The A.O. Is directed not to tax the receipts received by the assessee on supply of S200 Converters in all the these years." 11. The Tribunal followed this very reasoning for the present Assessment Year. Mr Pinto submits that the Revenue has challenged this finding and for earlier Assessment Years by filing an Appeal but he has no instructions with regard to the outcome thereof. Mr Pardiwalla submits that the Appeals have been dismissed on technical grounds. Apart therefrom, we are not in agreement with Mr Pinto that the widest possible meaning of the term 'royalty' and as found in the definition of the term in the explanation (2) would include the transaction under which payment has been made for supply of Converters. The agreement has been referred to by the Tribunal in detail. The Tribunal found that the agreement postulates the payment for the said equipment. The technical information that is provided is related to data plant specification flow sheet which are issued in....
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.....e. in relation to procurement of fees, there is concurrent finding of fact. After recording the admitted facts including the stipulation of double taxation avoidance agreement, the Tribunal has recorded that the payment received cannot be termed as 'royalty'. We do not find that it is vitiated by any error of law apparent on the face of the record or perversity. Appeal is accordingly dismissed with no order as to costs. INCOME TAX APPEAL NO.21 OF 2012 13. The facts and circumstances involved in this Appeal are identical to the facts and circumstances in Income Tax Appeal No.23 of 2012. For the reasons that have been indicated by us in the order passed in that Appeal, which is dismissed, we are of the view that the present Appeal also does not raise any substantial question of law. It is dismissed with no order as to costs. 14. We are in agreement with Mr Pinto that in this case, the Assessee did not provide something more than required as information to guide the Indian resident and hence the payment does not fall within the definition of the term 'royalty'. The clause which Mr Pinto relies upon and rather all the clauses of Explanation 2 would denote that....