TaxTMI 
TaxTMI 
2015 (10) TMI 930
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..... The appeal has been filed with delay of 5 days. The ld. AR submitted that the delay in filing of the appeal was unintentional. The delay occurred on account of miscalculation of the period of limitation in filing of the appeal. We are satisfied that the delay in filing of the appeal is not wilful. The delay occurred due to bonafide mistake as stated above. In the interest of justice, delay of 5 days in filing of the appeal is condoned and the appeal is admitted to be heard on merits. 3. The assessee-company is engaged in the business of providing translation services through Web. For the assessment year under consideration, the assessee filed its return of income on 29.9.2009 declaring total income of Rs. 52,76,148/-. The gross total inc....
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....rishnan, CA, appearing on behalf of the assessee, submitted that the authorities below have erred in coming to the conclusion that payments made for translation services are in the nature of fees for technical service. The ld. AR contended that the services rendered by the assessee to its clients are neither technical nor managerial in nature. The assessee is receiving work order from its clients around the world for translation of scripts from one language to an other. The assessee is getting the translations done from translators in India and overseas. The disallowance made under Section 40(a)(i) is with respect to payments made to foreign freelance translators. The non-resident translators are engaged through internet on first-cum-first ....
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.... below. The Assessing Officer has made disallowance of Rs. 2.63 Crores under Section 40(a)(i) on account of non-deduction of tax at source on the payments made to nonresident translators. The authorities below have held translation services to be technical in nature. On the other hand, the contention of the assessee is that the payment for translation services to non-residents does not fall within the ambit of "fees for technical, managerial or consultancy services". 7. Let us first understand the scope of the term "technical services". The expression "technical services" has not been defined anywhere in the Act. However, "fees for technical services" has been defined in Explanation 2 to Section 9(1)(vii) of the Act, which reads as under:-....
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....slation of the text from one language to another. The only requirement for translation from one language to other is, the proficiency of the translators in both the languages, i.e. the language from which the text is to be translated, to the language in which it is to be translated. The translator is not contribution anything more to the text which is to be translated. He is not supposed to explain or elaborate the meaning of the text. Apart from the knowledge of the language, the translator is not expected to have the knowledge of applied science or the craft or the techniques in respect of the text which is to be translated. A bare perusal of Explanation 2 to Section 9(1)(vii), which explains "fees for technical service" and the dictionar....