TaxTMI 
TaxTMI 
2016 (2) TMI 235
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....delay of 19 days in filing the cross-objection before the Tribunal. The assessee has filed an affidavit for condonation of delay stating that due to non-availability of the authorized person to sign necessary documents, the cross objection was filed belatedly. We have gone through the affidavit filed by the assessee and we are of the opinion that there is good and sufficient reason for filing the cross-objection belatedly. Accordingly, the delay is condoned and the cross-objection is admitted for adjudication. 3. The first ground in Revenue's appeal is with regard to deleting the disallowance made u/s.40(a)(i) in respect of carrier payments made to M/s. Clikatel, South Africa without deduction of tax at source. 4. We have heard both t....
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....t a technical service and hence no disallowance is required to be made. 6.3 In order to determine whether the services rendered by the non-resident carrier comes under technical services, the provisions of Double Taxation Avoidance 'Agreement (DTAA) need to be looked into. When the appellant enters into a transaction with a non-resident, the provisions of the Income Tax Act or the Double Taxation Avoidance Agreement (DTAA) whichever is favourable shall apply. As per DTAA between India and South Africa, the fee for technical service has been defined as, "payments of any kind received as a consideration for services of a managerial, technical or consultancy nature, including the provision of services by technical or other personn....
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.... Carrier, for the following reasons: . a) The non-resident Carrier would get payment for transmitting the bulk 'SMS data. As the services are rendered outside. India the provisions of section 5 cannot be applied to the payment made to the nonresident Carrier so as to make it taxable in India. It is also seen that the non-resident Carrier does not have any permanent establishment in India. Further, in order to attract section 195, the services by the non-resident Carrier should have been rendered in India and also should have been used in India.' It is to be noted that Section 195 of the Act has to be read along with the charging sections 4, 5 and 9 of the Act and the provisions of the Tax Treaties and the combined reading o....
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....and no part of the payment made to Clickatel is chargeable to tax in India. The Commissioner of Income Tax (Appeals) also followed the decision of Hon'ble Supreme Court in the case of CIT Vs.Bharti Cellular Ltd. (330 ITR 239 ) on the issue. The Hon'ble Delhi High Court the case of CIT Vs. Bharti Cellular Ltd. (319 ITR 139) held that these services do not involve human intervention and these services cannot be regarded as fee for technical services. The Hon'ble Madras High Court in the case of Verizon Communications Ltd. Vs. ITO in T.C.(Appeal) Nos. 147 to 149 of 2011 and 230 of 2012 dated 7.11.2013 held that collection of fees for usage of standard facility would not amount to payment made for providing technical services. In the circumstan....