TaxTMI 
TaxTMI 
TaxTMI 
2016 (11) TMI 658
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....as a common point between the parties that the facts and circumstances in relation to the said dispute are similar in all the assessment years, therefore, appeal of the assessee for Assessment Year 2003-04 is taken as lead case in order to appreciate the controversy. ITA NO. 2619/MUM/2014 (A.Y : 2003-04) 3. This appeal by the assessee is directed against the order of CIT(A)-10, Mumbai dated 08.11.2013, pertaining to the Assessment Year 2003-04, which in turn has arisen from the order passed by the Assessing Officer, Mumbai under section 144C(3) r.w.s. 147 r.w.s. 143(3) of the Income Tax Act, 1961 (in short 'the Act'). 4. Briefly put, the relevant facts are that the appellant is a tax resident of Ireland and is engaged in the business of....
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...., Assessing Officer treated the amount of Rs. 24,94,595/- received by the assessee from Indian customers/subscribers as Royalty. The total income was determined at Rs. 24,94,591/- and it has been taxed @ 10% on gross basis by relying on Article 12 of the Indo-Ireland DTAA. 5. Notably, the said assessment has been finalised by the Assessing Officer after issuance of notice of reopening u/s 148 of the Act on 30.3.2010. The Assessing Officer reopened the assessment for Assessment Year 2003-04 on the ground that similar amounts earned by the assessee in Assessment Years 2004-05 and 2007-08 were held to be taxable as 'Royalty' in terms of Article 12 of Indo-Ireland DTAA read alongwith Sec. 9(1)(vi) of the Act. The CIT(A) has also sustained the ....
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.... `business profits' is not free from doubt in view of the conflicting judgments rendered by the Hon'ble Karnataka High Court in the case of Wipro Limited (supra) and the Hon'ble Delhi High Court in the case of Ericsson A.B. *(2012) 204 Taxman 192 (Del.)]. It was submitted that the Mumbai Bench of the Tribunal in the case of DDIT (IT) v. M/s. Solid Works Corporation [ITA No.3219/Mum/2010] vide its order dated 08.01.2012 considered both the judgments and thereafter took a view in favour of the assessee by holding that the amount was in the nature of `business profits' and not `royalty'. The said decision of the Mumbai Bench was subsequently followed by the Mumbai Bench in another case and the Pune Bench of the tribunal in Allianz SE v. ADIT (....
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....ch as it has not been altered by any higher authority. So however, the learned representative pointed out that the judgment of the Hon'ble Karnataka High Court in the case of Wipro Ltd. (supra), which has been relied by the Tribunal, to decide the issue against the assessee be not be followed for varied reasons. Firstly, according to him, assessee was not a party before the Hon'ble Karnataka High Court and it was a case where the issue related to the nature of payments made by M/s. Wipro Ltd. as a customer of the assessee-company; and secondly, that subsequently the Hon'ble Delhi High Court in the case of Infrasoft Ltd., 39 Taxmann.com 88 (Delhi) has examined payment of a similar nature and found it to be not in the nature of royalty after ....
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....] 21 taxmann.com 62 (Pune) iii) M/s. Reliance Industries Ltd., [2016] 69 taxmann.com 311 (Mumbai -Trib) iv) M/s. Solid Works Corporation, ITA No. 3219/Mum/2010 dated 8.1.2012 8. On the other hand, the ld. DR has reiterated the decision of Tribunal in assessee's own case for Assessment Year 2007-08 dated 24.7.2013 (supra) which according to him fully covers the controversy before us. 9. We have carefully considered the rival submissions. At the outset, we may notice that so far as the similarity of fact-position in the instant year vis-a-vis Assessment Year 2007-08 (supra) is concerned, there is no divergence between the parties before us. In Assessment Year 2007-08 (supra), Tribunal considered the judgment of Hon'ble Karnataka High ....
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....in the hands of the payer of such income. Therefore, as per principles of judicial consistency and considering that the decision of Tribunal dated 24.7.2013 (supra) has not been altered by any higher authority, we deem it fit and proper to decide the issue in favour of Revenue and against the assessee. Thus, following the precedent, stand of the Revenue is upheld and assessee fails. The plea of the learned representative before us, based on the judgment of Hon'ble Supreme Court in the case of Vegetable Products Ltd., 88 ITR 192 (SC), that where two views are possible, one that is favourable to the assessee should be preferred, is also not acceptable. This is for the reason that the view of Hon'ble Karnataka High Court is specific to....