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TaxTMI 
TaxTMI 
TaxTMI 
2021 (12) TMI 1369
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....ently contended that there exists no principal to agent relation between the assessee and its distributors giving rise to commission element qua the pre-paid recharge coupons. Mr. Doshi rather sought to buttress the point that the assessee has sold its coupons to the distributor giving credit to them regarding latter's inbuilt profit element than commission attracting TDS deduction u/s. 194H of the Act. We find no merit in the assessee's instant former substantive grievance since the CIT(A) has duly taken note of hon'ble jurisdictional high court decision in M/s. Vodafone Essar South Ltd. Vs. DCIT in ITTA No.291 of 2013 Dt.17.07.2013. Their lordships have upheld the departmental stand pertaining to applicability of section 194H involving identical prepaid recharge coupons issued to the distributors. It further appears that the said assessee was the assessee's group concern only. We thus adopt their lordships foregoing detailed reasoning mutatis mutandis and reject the instant former substantive grievance. 3. The fact also remains that the legislature has itself incorporated section 201(1) first proviso in the Act vide Finance Act, 2012 w.e.f. 1.7.2012 that an assessee shall ....
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....ark or similar property ; (ii) the imparting of any information concerning the working of, or the use of, a patent, invention, model, design, secret formula or process or trade mark or similar property ; (iii) the use of any patent, invention, model, design, secret formula or process or trade mark or similar property ; (iv) the imparting of any information concerning technical, industrial, commercial or scientific knowledge, experience or skill ; (iva) the use or right to use any industrial, commercial or scientific equipment but not including the amounts referred to in section 44BB; (v) the transfer of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work including films or video tapes for use in connection with television or tapes for use in connection with radio broadcasting 32[***] ; or (vi) the rendering of any services in connection with the activities referred to in sub-clauses (i) to (iv), (iva) and (v)." There is no indication in the Assessing Officer's TDS recovery order or in the CIT(A)'s findings as to whether the assessee's impugned payments....
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.... plea taken by the AO in the order u/s. 201(1) and 201(1A) that the payment of roaming charges may be taken as 'royalty' covered u/s. 194] is now examined. The appellant's submissions in this regard are as under: 5.4.1 Alternatively, the TDS Officer has taken a stand that the payment will be considered as royalty which again is covered under section 194] of the Act. 1. in this regards, the Appellant would like to submit that the payment made to telecom operators will not be royalty to fall within the ambit of section 194] of the Act. 2. In this respect, the Appellant would humbly submit that the Hon'ble Delhi tribunal in the case of Bharti Airtel (67 taxmann.com 223) has held that the charges paid by the assessee to foreign telecom operators was neither FTS nor royalty. Infact, the above decision of Bharti Airtel (supra) has also considered the decision in the case of Vodafone south limited (supra). The Hon'ble tribunal after detailed examination of the issue and also after examination of the technical experts opinion has clearly held that the said service cannot be considered as 'FTS' or Royalty' and no tax is required to be deducted under....
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....'process' and allows the 'use' thereof to the grantee in return for a 'royalty. It is necessary than guarantee must 'use' the 'process' on its own and bear the risk of exploitation. The process running the networks in the case of all the telecom operators is essentially the same and the do not have any exclusive right over such 'process' so as to be in a position to charge a 'royalty. For allowing the use of such process, the term 'use' in context of royally connotes use by the grantee and not by the grantor. A 'process' which has been in public domain forrige time and is widely used by everyone in the field cannot constitute an item of inte property for the purpose of charge of royalty (Para 54.2" It is seen that the non Die Deini Tribunal, in the case cited supra, nas examin the agreements between the assessee and the FTOS (Foreign Telecom Operators), ara has come to the conclusion that in that case, the FTOS did not have any exclusive ng the agr which was granted to the assessee, and that therefore, the payment cannot be termed as royalty'. It's a so the contention of the appellant that the actual character of the issue consideration ....
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....ly license the use of spectrum to regulate its application and maximize social benefit. A spectrum auction is a process whereby a government uses an auction system to sell the rights (licenses) to transmit signals over specific bands of the electromagnetic spectrum and to assign scarce spectrum resources. Spectrum pricing is an invaluable tool to promote efficiency. The International Telecommunication Union (ITU) proposes four different methodologies for spectrum valuation Sner or come Tax i. Price from previous auctions duly indexed ii. Estimation of the value of spectrum by assessing producer surplus iii. Valuation of spectrum using a production function approach iv. Valuation of spectrum using a revenue surplus approach. In addition to these four methods, TRAI also uses a multivariate regression technique. Historical Background of Spectrum Auction in India India was among the early adopters of spectrum auctions beginning auctions in 1991. Despite the early start in auctions, services have been slow to roll out caused by unforeseen problems with the design and rules of the auction. Potential service providers rabad were req....
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....across almost all the circles. (Source:https://gadgets.ndtv.com/telecom/features/tech-101-what-is- spectrum-and-why is-it-being-auctioned-8247211 Present case: In the Vodafone Idea Limited Case, which is under consideration here, the phrase "License Area" mentioned in agreements entered into by Idea Cellular with other Cellular Service Providers, consists of license allocated for use of spectrum and also to operate in a specific area called Circle. Hence, roaming charges paid to the other Telecom Operators in the country pertains to the spectrum allotted to such operators. The payments made by various operators for the Spectrum allotted to them is termed as Royalty as per the TRAI (Telecom Regulatory Authority of India) document, namely, "Recommendations on Spectrum Usage Charges and Presumptive Adjusted Gross Revenue or Internet Service Providers and Commercial Very Small Aperture Terminal Service Providers" dated 07-09-2017 and the Order ref: P- 11014/34/2009-PP(II) dated 22-02-2012 of the Wireless Planning & Coordination Wing (WPC) Wing, Department of Telecommunication, Ministry of Communications & IT, Government of India also u....