AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (10) TMI 1447
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....ows the brief of contentious issue between the assessee and the revenue: "That the [d. AO has erred on facts and in law in holding that the payments received by the Appellant for rendering various marketing and advertisement services to customers in India, were taxable as "Fees for Technical Services" ("F T S"), in terms of Article 12 of the India-US Double Taxation Avoidance Agreement ("D TAA") without appreciating that the same does not qualify as such in terms of Article 12 of the D TAA. That the [d. AO has erred in law and on facts in mechanically following the assessment order for AY 1998-99 and disregarding the fact that the same has been overruled by the decision of the Hon 'ble Delhi High Court vide order dated January 30, 2009 in Appellant's own case for A. Y. 1995-96 to 2000-01. That the Ld. AO has erred in law in not following the decision of the Hon 'ble Delhi High Court merely on the ground that the same has not been accepted by the Department and an appeal against the said decision has been filed before the Hon 'ble Supreme Court.' 4. Facts of the case in brief are that the assessee is a company incorporated under the laws of United State....
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....iven by the assessee to its clients- hotels was examined by the Tribunal. It returned a finding that there was nothing on record for it to come to conclusion that the real transaction was other than what was stated in the agreement, that is, the use of the trademark etc. was not free of cost but was camouflaged in the composite payment made for various services; (ii) the assessee, ITC Ltd. had its own brand by the name of 'Welcome group' which, as noted in the impugned judgment, was used alongside the assessee's brand name 'Sheraton Furthermore, ITC Hotels Ltd., like the assessee also had its own network by the name of 'Welcomenet' which was used for reservations within the country; (iii) the entire transaction entered into between the assessee and its clients-hotels was an 'integrated business arrangement' under which the main purpose was to carry out advertisement, publicity and sales promotion for mutual benefit, in this context all other services i.e., use of trademark, trade name, computer reservations were incidental to the main purpose as stated above; (iv) it found as a matter of fact that the payments received by the assessee were neit....
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....hnology available'. The finding to this effect is given in paragraph 83 of the impugned judgment. The relevant extract is given here in below:- "It is also further clarified in the Memorandum of Understanding that technical and consultancy services as envisaged under paragraph 4(b) of article 12 could make technology available in a variety of settings, activities and industries and some of the areas to which such services may relate are also enumerated in the Mol-J which do not include the hotel industry. One of such areas as indicated is the MoU is 'communication through satellite or otherwise' and relying on the same, learned Special Counsel for the revenue has contended that the interface between the reservation system of the assessee-company and that of the Indian hotels/clients was covered in this category. We, however, find it difficult to agree with this contention of the learned Special Counsel for the revenue. First of all, it is the area which has been specified in the Mol-J for ascertaining the services relating thereto being of technical and consultancy nature making technology available whereas the services rendered by the assessee in the present case are....
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.... agreement since, no evidence whatsoever to support or substantiate the said allegation was placed before them. It also noted the fact that not only all statutory requirements have been fulfilled and compliances had been obtained by the assessee from time to time, but that even the Income-tax Authorities had given a 'no objection' under section 195(2) of the Act (see observations in paragraph 90 of the impugned judgment). As regards the payments received on account of SCI and FFP the Tribunal noted that since the job undertaken by the assessee-company was in the nature of 'integrated business' arrangement, whereby services were rendered to its clients-hotels in relation to advertisements, publicity and sales promotion of hotel business worldwide to further their mutual interest all services including the use of trademark and other services enumerated in the article including the programmes, in issue, such as SCI and FFP were incidental to the said business arrangement between the assessee and its clients-hotels. It concluded by holding that these programmes were not independent or separate from the main job undertaken by the assessee and since, the entire amount tow....