2015 (10) TMI 384

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....e to make TDS before making payment to the non-resident holding company and thus invoking the provisions of sec.40(a)(ia) of the Incometax Act, 1961[hereinafter referred to as 'the Act']. 2. Brief facts of the case are that the assessee-company is engaged in the business of manufacturing and installation of structural glazing works in India. It entered into a separate management services agreement with its holding company on 7-1-2008 for the purpose of receiving advice on various matters of strategic and operational importance through phone calls or in personal meetings. During the relevant previous year, the assessee made a total payment of Rs. 1,69,90,080/- to its holding company out of which a sum of Rs. 71,43,829/- was toward....

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....oked the provisions of sec.9(1)(vii) of the IT Act to hold that even 'management services' come under the category of 'fee of technical services' and TDS was liable to be made. He submitted that where there is a treaty between India and the country in which the non-resident transacting company is located, the treaty provisions also have to be considered and the beneficial provision has to be applied. He submitted that as per the treaty between India and Singapore, services would fall within the definition of 'Fees for Technical Services' only if the services rendered 'made available' the technology. On the meaning and purport of the term 'made available' which is not defined under the Act, but is interpreted as occurring in India-US treaty ....

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....During the course of hearing, the learned counsel for the assessee has also filed additional evidence in the form of a letter from Singapore company to state that no designs were supplied to the assessee-company and that only management services were rendered. An affidavit was also filed in support of this contention. The assessee has sought admission of additional evidence and consideration thereof as it goes to the root of the matter. He submitted that mention of 'design' in the invoice was only an inadvertent mistake committed by adopting 'copy and paste' options in the computer while making the bill. Further, the assessee has also raised additional grounds of appeal stating that the payments made were nothing but reimbursement of expens....

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.... assessee has filed a copy of the Agreement between the assessee and the holding company and its group company at Italy before the CIT(A) whereas before this Tribunal, the assessee has filed a copy of the agreement between the assessee and its holding company at Singapore. He submitted that the additional grounds of appeal raised by the assessee also need verification of facts by the AO and therefore they should not be admitted. As regards the assessee's claim that the word 'design' mentioned in invoice was an inadvertent mistake, he submitted that the additional evidence filed before us is subsequent to the assessment proceedings and therefore cannot be relied upon and should not be admitted. 6. Having heard both the parties and having ....