TaxTMI 
TaxTMI 
2015 (3) TMI 684
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....on), Ward 19(1), Bangalore, holding the assessee as an 'assessee in default' u/s. 201(1) of the Act and levying interest u/s. 201(1A) of the Act on the tax not deducted at source for the assessment year 06-07. 3. All these appeals involve common issues and arise for consideration on same facts and circumstances. Having heard these appeals together, we deem it appropriate to pass a common order. The facts and circumstances giving rise to these appeals are as follows. 4. An Indian company by name 'M/s. Biocon India Ltd.,' registered under the Companies Act, 1956 [hereinafter called as "BIOCON"] is a pioneer in biotechnology and was engaged in the manufacture and marketing of various enzymes, active pharmaceutical ingredients and specialty chemicals. 5. CIMAB SA, Cuba [hereinafter referred to as "CIMAB"] is a Cuban company engaged in research, development, manufacturing and marketing of biopharmaceuticals. CIMAB had developed technology for some products which are necessary for manufacture of drugs for treatment of cancer. "Technology" means :- (a) know-how viz,, information required for scientific, technical and technological evaluation of production of th....
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....e shares issued to CIMAB was the value of the technology that was brought in by CIMAB as capital contribution to the JVC. 9. The assessee filed an application u/s. 195(2) of the Act on 13.01.2005, a copy of which is at page Nos.338 to 348 of the assessee's paperbook. The application narrates various circumstances under which shares ought to be issued to CIMAB and that the consideration paid by the assessee to CIMAB in the form of shares is not a payment which could be said to be "royalty" within the meaning of the definition given in the Act. In the application, the assessee prayed for grant of permission to issue equity shares against transfer of technology without deduction of tax at source. It should be mentioned here that this application was made by the assessee on 13.01.2005. Even prior to this date, the assessee had already issued 4,21,400 and 17,24,800 equity shares to CIMAB i.e., on 30.03.2004 and 30.09.04 respectively. There is no reference to the fact that certain shares had already been issued to CIMAB in its application dated 13.01.2005. The Assessing Officer passed an order dated 22.02.2005, a copy of the same is at pages 333 & 334 of the assessee's paperbo....
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....rce. The AO accordingly issued show cause notice u/s.201(1) of the Act asking the Assessee to show cause as to why he should be treated as an "Assessee in default" in respect of taxes not deducted at source (on the value of the shares) while issuing shares to CIMAB and also show cause notice u/s.201(1A) of the Act asking the Assessee to show cause why interest on tax not deducted from the date on which tax ought to have been deducted at source till the date on which taxes are paid to the Government should not be levied. 12. According to the assessee, the consideration paid by it to CIMAB was for transfer of capital asset viz., "technology", which would be income chargeable under the head 'capital gains' falling within the exception contemplated by Explanation 2 to section 9(1)(vi) of the Act. The assessee's further contention was that even capital gains is not chargeable to tax in India because the transfer of the capital asset viz., the technology took place outside India and therefore section 45 of the Act read with sections 4 & 5 of the Act was not attracted. Hence there was no obligation to deduct tax at source. 13. According to the Revenue, the value of the s....
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....B in India and therefore taxable in India. 17. Besides the main issue, several technical and legal objections on applicability of section 195 of the Act, rule of estoppel, delay in passing order us/. 195 of the Act and its other consequences have been raised by the assessee. We will deal with each of the above contentions of the assessee separately. 18. ISSUE NO.1: Whether the provisions of Sec.195(1) of the Act are not applicable when shares are issued to a Non-resident (which is a foreign company in the present case) because it cannot be said to be a payment of "any other sum chargeable under the provisions of this Act" within the meaning of the said expression used in Sec.195(1) of the Act? 19. The argument of the learned counsel for the Assessee on the above issue was that Sec.195(1) of the Act casts obligation on the person responsible for paying to a non-resident, any other sum chargeable under the provisions of the Act, to deduct tax at source at the rates in force at the time of crediting such income to the account of the payee OR making payment by cash, cheque, draft or any other mode, whichever is earlier. It was his submission that when shares are issued in cons....
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....o have deducted tax at source on the value of the shares so issued. The learned DR relied on the decision of the Hon'ble Supreme Court in the case of Kanchanchunga Sea Foods Ltd. v. CIT 325 ITR 540 wherein the question was whether income accrued in India to a Non-resident who had hired trawlers to an Indian company and the hire charges had to be quantified at 85% of the value of fish caught or 600000 US $ whichever is less. The Hon'ble Supreme Court held that the Indian company carried out fishing in economic zone of India and the charter fee was paid to non-resident equivalent to 85% of the value of the fish caught. The quantification was also done in India and therefore income accrues to non-resident in India. The learned DR laid emphasis on the point that even when consideration is quantified otherwise than in terms of money, income accrues or arises. 22. We have considered the rival submissions. Sec.80-G of the Act grants deduction while computing total income "any sums paid by the Assessee in the previous year as donation". The question before the Hon'ble Supreme Court in the case of H.H. Sri Rama Verma (supra) was as to whether donations in kind are also entitl....
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....o CIMAB and that the consideration paid by the assessee to CIMAB in the form of shares is not a payment which could be said to be "royalty" within the meaning of the definition given in the Act. In the application, the assessee has prayed for grant of permission to issue equity shares against transfer of technology without deduction of tax at source. It should be mentioned here that this application was made by the assessee on 13.01.2005. Even prior to this date, the assessee had already issued 4,21,400 and 17,24,800 equity shares to CIMAB i.e., on 30.03.2004 and 30.09.04 respectively. There is no reference to the fact that certain shares had already been issued to CIMAB in its application dated 13.01.2005. The Assessing Officer passed an order dated 22.02.2005, a copy of the same is at pages 333 & 334 of the assessee's paperbook. The AO in this order, purported to have been passed u/s. 195(2) of the Act, was of the view that the assessee's stand that issue of shares against of transfer of technology would be in the nature of capital contribution of CIMAB and CIMAB would not earn any income was correct. The concluding portion of the order of the AO reads as under:- "In v....
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.... officer to determine the appropriate portion of such sum so chargeable and upon such determination, tax shall be deducted under Sub-Section (1) only on that proportion of the sum which is so chargeable. However, if the assessing authority is of the view that no tax is chargeable, a certificate to that effect could be issued to the person responsible for making payment. Once a certificate is issued, the liability of the person responsible for paying under the aforesaid provision ceases and without any deduction he may make the payment to the non-resident. Insofar as Section 197 is concerned it provides for a similar application being made by the recipient of the income. On such an application being made under Section 197(1), the assessing officer can give to him such certificate as may be appropriate. If such certificate states no tax is deductible, until such certificate is cancelled by the assessing officer, the person responsible for paying the income is under "No obligation" to deduct tax while making payment. In fact the language employed is "Shall". Therefore, it is mandatory in nature. What is the effect of such a certificate was the subject matter of interpretation." "Wh....
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....t the assessee cannot be treated as an assessee in default in respect of issue of shares to CIMAB for failure to deduct tax at source. 30. Apart from the above, we also find that u/s. 195(2) of the Act, the power to make an application in respect of payments to a non-resident is where the payer considers that the whole of the payment will not be income chargeable in the case of the recipient. The payer can only call upon the AO to determine the appropriate proportion of sum chargeable to tax in India and the tax that the payer has to deduct on that proportion which is chargeable to tax in India. The provisions of Sec.195 of the Act is reproduced for the sake of better appreciation and clarity and it reads thus: "SECTION 195 : Other sums : (1) Any person responsible for paying to a non-resident, not being a company, or to a foreign company, any interest (not being interest referred to in section 194LB or section 194LC) or any other sum chargeable under the provisions of this Act (not being income chargeable under the head "Salaries" shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or d....
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....on responsible for paying such interest or other sum to the person to whom such certificate is granted shall, so long as the certificate is in force, make payment of such interest or other sum without deducting tax thereon under sub-section (1). (4) A certificate granted under sub-section (3) shall remain in force till the expiry of period specified therein or, if it is cancelled by the Assessing Officer before the expiry of such period, till such cancellation. (5) The Board may, having regard to the convenience of assessees and the interests of revenue, by notification in the Official Gazette, make rules specifying the cases in which, and the circumstances under which, an application may be made for the grant of a certificate under sub-section (3) and the conditions subject to which such certificate may be granted and providing for all other matters connected therewith. (6) The person referred to in sub-section (1) shall furnish the information relating to payment of any sum in such form and manner as may be prescribed by the Board. (7) Notwithstanding anything contained in sub-section (1) and sub-section (2), the Board may, by notification in the Official Gazette, spe....
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....section 195(2) of the Act. In view of the clear language of the provisions of section 195(2) of the Act, we do not think it necessary to elaborate on the submissions made by the ld. Counsel for the assessee by drawing analogy to various provisions in the Act and case laws referred to in this regard. In none of the case laws elaborated by the ld. Counsel for the assessee in his written submissions deal with the scope of section 195(2) in the context of a payer making an application for Nil deduction of tax at source. We are of the view that the submissions made by the assessee in the written submissions are a desperate attempt to justify the Nil deduction of tax granted by the AO which fortunately for the revenue did not operate at the relevant point of time when the assessee issued shares to CIMAB. 32. The question for consideration would be as to what is the effect of the order dated 22.02.2005 passed by the Assessing Officer u/s. 195(2) of the Act holding that no tax is deductible by the payer. In our view, when there is no power u/s. 195(2) of the Act to hold that no tax is deductible at source, on an application filed by the person making payment to a non-resident, the order....
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....ue is precluded from proceeding against the Assessee for failure to deduct tax at source u/s.201(1) of the Act, in respect of issue of shares made on 30.9.2005 and 31.3.2006 by reason of the application of principle of estoppel? Alternatively, can it be said that because the Revenue did not dispose the application of the Assessee u/s.195(2) of the Act, within a reasonable time, the permission prayed for is deemed to have been granted? 35. The next contention of the ld. counsel for the assessee was that in respect of issue of shares after 31.03.2005, the assessee made an application on 17.10.2005 and 10.07.2006 for issue of no tax deduction at source, that application was not disposed of the by the AO. It was submitted that in the light of the earlier view of the AO that there is no income chargeable to tax in the hands of the non-resident in India, the assessee entertained a belief that there was no requirement of tax deduction at source. It was therefore submitted that in respect of shares issued by the assessee on 30.09.2005 and 31.03.2006, the assessee did not deduct tax at source. It was argued that the revenue is precluded from initiating proceedings u/s.201(1) of the Act o....
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....es. We have already extracted in the earlier part of this order the operative portion of the order dated 22.2.2005, which clearly specifies that it is valid only for issue of shares upto 31.3.2005. This order was in response to the Assessee's application dated 13.1.2005 in which the Assessee did not disclose the facts regarding issue of shares to CIMAB on 30.3.2004 and 30.9.2004. Therefore the Assessee cannot take any benefit under the order dated 22.2.2005 for any issue of shares to CIMAB. 38. As already stated the order dated 22.2.2005 is not in accordance with law because that order which was passed u/s.195(2) of the Act, was in response to an application by the person responsible for making payment in which the dispute can be only with regard to the rate of tax and not the question whether tax at all is deductible at source or not, which remedy is available only to the recipient of the payment u/s.195(3) or 197 of the Act. Law is well settled that there cannot be an estoppel against a statute. The CBDT Circular No.774 dated 17.3.1999 referred to by the ld. counsel for the assessee will not have any operation to the present case, as the provisions of section 197 are not a....
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....5 of the Act are clear and are not ambiguous. As already stated the order u/s.195(2) dated 22.2.2005 operated only for a limited period. Fortunately for the revenue during that period, the Assessee made no issue of shares to CIMAB. The provisions of law are clear that each of the payments to non-resident or foreign company requires specific order, unless there is any other general order operating for an indefinite period of time. We therefore reject the arguments advanced on this issue and hold against the Assessee on issue No.4. 43. ISSUE NO.5: Whether the issue of shares by the Assessee to CIMAB would constitute a payment of "Royalty" by the Assessee to CIMAB which can be said to accrue or arise in India to CIMAB and therefore taxable in the hands of CIMAB in India and consequently the Assessee be held as liable to treated as an Assessee in default u/s.201(1) of the Act? 44. Another issue that may require consideration as an alternate to the above issue will be as to whether CIMAB is liable to tax on capital gain on transfer of technology. Consequently, whether assessee can be said to be 'an assessee in default' to the extent of tax on capital gain? 45. On the ab....
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.... The machinery provisions viz., the computation of capital gain as given in section 48 of the Act should be capable of being applied. (d) The transfer of technical know-how should have taken place in India. In the course of hearing we had specifically put it to the learned counsel for the Assessee as to whether the Assessee made a claim before the AO that the transfer of technical know-how took place outside India. We also asked him as to how in his written submissions he claims that transfer of technology took place outside India and evidence if any to show that transfer of technology took place outside India. In his elaborate submissions filed after the hearing in which such queries were raised, there is no whisper on this aspect except a plea that situs of know-how would be Cuba and therefore the transfer of the know-how should also be considered as having taken place outside India. We will deal with this aspect later. If the exclusion clause is not found to be applicable in the present case, then we have to examine as to whether any of the clauses referred to in Explanation 2 to section 9(1)(vi) of the Act are attracted. The AO proceeded on the footing that clause (i) and....
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.... be equivalent to 49% of the paid-up capital of the JVC. The paid-up capital of the JVC was dependent on the capital for constructing/securing the Biotechnological Plant and circulating funds for beginning the production and first operation of the JVC and all these had to be borne by BIOCON as its share of capital contribution to the JVC. The cost so borne will be 51% of the issued, subscribed and paid up capital of the JVC and based on the above 49% of the paid-up capital had to be allotted to CIMAB which will be the value of the technology brought in by CIMAB for use by the JVC. 51. Under clause 2.1 of the JVA it is provided that the JVC will manufacture cancer drugs using the technology developed by CIMAB The JVA in Clause 11 provides as follows:- "Article 11. Technology Transfer 11.1 The Technology that CIMAB will transfer to JVC in terms of this JVA shall consist of consist in the following: 11.1.1 The Technical Information, including the Know-how for production and the entire documentation required for making possible the manufacture of the Product as per the specifications, to be finalized and signed off as Annexure 4 in a supplement agreement to be executed with....
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....struction programme. 54. As can be seen from clauses 11 and 12 of the JVA, there is a reference to Annexures 4, 2 and 5 to the agreement. These Annexures were superseded by a Technology Transfer Agreement (TTA) dated 03.12.2003. The terms of this Agreement need to be seen carefully, as these terms will throw light on what is transferred by CIMAB to the assessee. In the preamble to this Agreement, CIMAB claims that it owns right to transfer technology in relation to commercial manufacture and marketing of products [viz., (a) Human Recombination Crythroposeon, (b) Granulocyte Colony Stimulating factor, and (c) TheraCIM hR3 Humanised Monoclonal Antibody against Epidermal Growth factor receptor]. It is further mentioned that the same is being transferred in terms of the said Agreement to the assessee. The area for which transfer was valid is India for products (a) and (b). For product (c), the area is India, Bangladesh, Bhutan, Nepal, Pakistan and Sri Lanka. Technology has been defined in clause 1.14 of this Agreement as follows:- '1.14 "Technology" shall mean (i) conceptual and basic engineering for the Facility based on current Good Manufacturing Practice (cGMP) (ii) procur....
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.... to the terms agreed by the Board of Directors of BBPL for the technicians, specialists or qualified experts who travel to BBPL to provide Technical Advise." 56. Appendix 4 to the agreement gives a list of the scope of technical advise. Technical Advise includes the personnel of CIMAB coming to India and rendering assistance in the pre and post-production of the products. The above clauses in the JVA & TTA make it clear that apart from know-how CIMAB was also required to render Technical Service in India. 57. We should keep in mind that there can be mixed contract for supply of know-how and technical services in consideration of lump sum payment. The lump sum consideration must be broken down into parts and that part of the consideration attributable to know-how has to be brought to tax as 'royalty' assuming that the consideration paid is for imparting of any information concerning technical, industrial, commercial or scientific knowledge, experience or skill. That part of the consideration attributable to providing 'technical services' has to be brought to tax as fees for technical services rendered. Such apportionment has to be on the basis of the informatio....
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.... by law. Article 4 Patents 4.2 If CIMAB has patented the Improvement/Improvements, CIMAB will grant a royalty free license to BBPL in perpetuity subject to BBPL agreeing that during the term of this Agreement it will not disclose/transfer/licence the same to any Third Party (excluding regulatory authorities), except on such terms as may be mutually agreed between BPPL and CIMAB. 4.3 If BPPL has patented the Improvement/Improvements, BBPL will grant a royalty free license to BBPL in perpetuity subject to CIMAB agreeing that during the term of this Agreement it will not disclose/transfer/licence the same to any Third Party (excluding regulatory authorities), except on such terms as may be mutually agreed between BPPL and CIMAB. Article 6 Improvement & Improvements 6.2 Any Improvement or Improvements made in the Territory by BBPL will be property of BBPL and shall be licenced royalty free in perpetuity to CIMAB outside the Territory subject to CIMAB agreeing that during the term of this Agreement CIMAB will not disclose/transfer/licence the same to any Third Party (excluding regulatory authorities), except on such terms as may be mutually agreed between BPPL and CIMAB. ....
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....The JVA read together with the JVA contains two parts. The first part transfers right to use know-how. This part is a separate contract and the right to use know-how so transferred was "Royalty" within the Explanation 2(iv) to section 9(1)(vi) of the Act. The second part is the mode of payment of the consideration payable under the JVA & TTA for providing technology by CIMAB to the assessee (right to use the know-how) which is in the form of issue of shares in the JVC. Accrual of income from the second part of the contract has to be brought to tax subject to fulfillment of conditions specified in section 9(1)(vi) of the Act. The fact that the consideration payable under the Agreement is discharged by issue of shares in a JVC will have no effect on accrual of income in India and its taxability in India. 61. Having held that there was a right to use the technology falling within the section 9(1)(vi) Explanation 2(iv) of the Act by the assessee for which payments were made to CIMAB, we need to see as to whether the JVA read with TTA is a composite contract by which the right to use the know-how was provided together with technical services. This exercise, in our view, need not be c....
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....existing provisions of s. 115A of the IT Act, the amount of income-tax payable on the gross amount of income by way of royalty or fees for technical services received by a foreign company from an Indian concern or from Government is as under : (i) twenty per cent of such income as consists of lump sum consideration for the transfer outside India of the technical know-how; (ii) forty per cent on the balance of such income. 34.2 The basis for the aforesaid flat rates of tax on royalty and fees for technical services was a sample study made by the IT Department, prior to the enactment of these provisions w.e.f. 1st June, 1976, which showed that the expenses claimed against royalty income, (then being taxed at the rate of fifty per cent on net basis) were around twenty per cent and hence the flat rate of tax at forty per cent was determined. In view of the position that the lump sum consideration paid to foreign companies for the supply of technical know-how, drawings, designs and documentation etc. abroad were not taxable prior to 1976, it was decided that such lump sum amount should be taxed at the concessional rate of twenty per cent of the gross amount of such payments. ....
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....(i) to Sec.9(1)(vi) of the Act viz., For transfer of all or any rights (including the granting of a licence) in respect of a patent, invention, model, design, secret formula or process or trade mark or similar property. Know-how is not specifically referred to in this clause but it would be "similar property" like secret formula or process. Even transfer of part of the right comprised in the bundle of rights which comprised in the intellectual property i.e., know-how, would be covered by the aforesaid clause. (ii) Consideration paid for use of any patent, invention, model, design, secret formula or process or trade mark or similar property. As already stated, Know-how is not specifically referred to in this clause but it would be "similar property" like secret formula or process. Even transfer of part of the right comprised in the bundle of rights in the intellectual property i.e., know-how, would be covered by the aforesaid clause. (iii) Consideration paid for the imparting of information concerning technical, industrial, commercial or scientific knowledge, experience or skill, falling within the ambit of Expln.-2(iv) to Sec.9(1)(vi) of the Act. (iv) Consideration for con....
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....ncome of the recipient chargeable under the head "capital gain" " from the purview of the definition of royalty. His submission was that since the transfer of the capital asset had taken place outside India, the charging provisions of Sec.45 are not attracted and therefore capital gain is also not chargeable to tax in India. 69. The learned counsel for the Assessee submitted that the definition of the term "capital asset" u/s.2(14) of the Act is very wide. It means "property of any kind held by an Assessee" other than those specifically excluded. One of the items of exclusion is "stock-in-trade". In the JVA CIMAB is stated to be engaged in research, development, manufacturing and marketing of biopharmaceuticals. As to whether the technology transferred under the JVA and TTA would be stock-in-trade of CIMAB or not cannot be ascertained without the presence of CIMAB. This is another reason why we feel that in proceedings u/s.195(1) of the Act, the person making payment cannot ask for a "nil" deduction of tax at source. For example if it is held that the receipt would constitute business income of the recipient as to whether the recipient has a permanent establishment in India or n....
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....stock-in-trade (which is valued at cost) had been converted into a capital asset. On that facts of that case, the majority held that though the partnership was genuine, the assessee had adopted a calculated device of converting land into money by withdrawing substantial sums from the firm and debiting the same to its current account. It was held that the contribution by the assessee of its personal land to the share capital of the firm was a device or ruse for converting land into money for its benefit. It was opined that the entry of Rs. 11.50 crores being the value of land credited in assessee's capital account was not imaginary or notional and that it was chargeable to tax. We are of the view that the ratio laid down in the aforesaid decision cannot be applied to the present case as the issue was decided on the provisions of Sec.45(3) of the Act. The technology was given by CIMAB to a company that was to be formed and in lieu of payment of consideration for such transfer in terms of money, shares had been issued in the company formed. We are of the view that the principles applicable in such cases will be to look at the transaction as comprising of two contracts. The first c....
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.... and the nature of receipts from the know-how would essentially depend upon the transactions out of which the receipts arise and the context in which the receipts are received. If the imparting of know-how is really in the nature of services rendered without anything more, the receipt must be treated as a revenue receipt. But when consideration is received for imparting know-how in association with the disposal of a capital asset, then the receipt will have to be treated as a capital receipt....." The Hon'ble Court thereafter found that the Tribunal held that the transaction was in substance a parting by Wolf company with its property for the purchase price, the property being its connection or goodwill in India and its fund of confidential material and the transaction was not of "the nature of a technique for exploiting the Indian market to provide trading income". The Court also found that the finding recorded by the Tribunal was by virtue of the transaction Wolf company had parted with its property, being its connection or goodwill in India. The Hon'ble Court found that the company's exports to India amounted to 10 per cent of its total exports by volume and even ....
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....ly general principles and guidelines can be indicated which should be applied in individual cases according to the facts of each case. 3. 'Technical know-how' is a term of wide connotation and includes several kinds of technical knowledge assistance and services. There are several ingredients constituting technical know-how, such as :- (i) the design of the product to be manufactured; (ii) the design of the process for manufacture; (iii) the design and engineering of the plant; and (iv) the erection and commissioning of the plant etc. etc. There are also different ways of imparting technical know-how which may be :- (i) through outright sale of designs, know-how etc.; (ii) by lending the services of foreign technicians; (iii) by giving technical assistance during the period of agreement; (iv) through royalty or licensing agreements; or (v) through foreign capital participation. A further important aspect is whether or not the nomenclature used in the collaboration agreement really indicates the correct nature and purpose of the payment. In such cases, the real nature and purpose of the payment has to be ascertained and taken into account.....
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....empt from income-tax as the tax on capital gains. Further if the shares issued in consideration for technical know-how at the time of the incorporation of the Indian company are subsequently sold, the capital gains realised therefrom would be subject to tax. Preference shares allotted will be treated in the same way as equity shares in this regard." (Emphasis supplied) 75. In the present case, as we have already seen, operations are effected and services are rendered in India. There is nothing on record to show that there was delivery of technical know-how abroad. On the other hand the circumstances suggest that there has been delivery of technical know-how in India. The learned counsel for the Assessee had placed reliance on the decision of the ITAT Mumbai Bench in the case of Dy. CIT v. Lyka Labs Ltd. 310 ITR (AT) 427. That was a case where the question was whether receipts from imparting know-how for 3 years was capital or revenue receipt. The Tribunal held that there was no transfer of a capital asset and that there was only a right to use the information. It was further held that the Assessee was in the business of imparting of information and therefore the receipt was reve....
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....le of designs & drawings. The Tribunal came to the conclusion that there was an absolute sale of drawings and designs and that there was no rendering of technical services as contemplated u/s. 9(1)(vii) of the Act. We are of the view that the aforesaid decision will not be of any assistance to the case of the assessee before us. 78. The ld. Counsel for the assessee had placed reliance on Article 7.1 of the TTA, which provides that during the term of the agreement the assessee will use the know-how/technology and that the information obtained in the course of such use shall be treated as confidential information and will not be revealed to any person. The ld. Counsel relies on the aforesaid clause in the agreement and the fact that such a right to use is for 20 years contends that there was an absolute transfer of technology. We have already held in the earlier part of order that there was no transfer of know-how, but only a right to use the know-how. 79. Some arguments were advanced by the ld. Counsel for the assessee that technology transfer was not stock-in-trade of CIMAB and therefore it was a capital asset in the hands of CIMAB. We have already observed in the earlier par....