TaxTMI 
TaxTMI 
2022 (9) TMI 82
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....Assessment Year (A.Y) 2016-17. 2. The brief facts of the case is that the assessee is a company is engaged in the business of collecting market research data and conducting surveys/interviews in the different countries based on project specifications provided by its clients. In consideration, it receives payments on Cost Per Interview (CPI) basis. For the purpose of preparation of questionnaire and survey design, the assessee log into the Web Portal of the NEBU, A Netherlands-based Company and utilizes its survey link for the purpose. The assessee company charges its customer for the survey data and the assessee made payments of Rs. 7,24,268/- i.e. Euro 8790 in 6 installments to NEBU of Netherland. 2.1. The Assessing Officer held that....
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....n customers to the Taxpayer for providing bandwidth/telecom services by way of International Private Lease Circuit (IPLC) is taxable as "royalty". Wherein the High Court held that such payments amount to "Royalty" both under the Indian Tax Laws and Double Taxation Avoidance Agreement between India and Singapore. 3.2. The Hon'ble High Court also observed that post introduction of Explanation 5 in section 9(1)(vi) of the Act, scope of definition of Royalty under the Act has increased. Further, the assessee has not brought any decision on record of any other High Court post decision of Verizon Communications Singapore Pte. Ltd. (supra) judgment of Madras High Court after considering post amendment by Finance Act 2012 and introduction of Exp....
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....owing Grounds of Appeal: That on the facts and in the circumstances of the case and as per law the learned CIT (A) erred in upholding the action of the assessing officer treating the assessee in default under section 201 of the Income Tax Act 1961 and thereby confirming the demand of Rs. 78,264 on the ground of short deduction of taxes and Rs. 20,279 towards interest under section 201 (1A) of the Act, 1.2 That the learned CIT (A) erred in upholding the contentions of the assessing officer that appellant was liable to deduct tax at source, in respect of payment made to NEBU (a Netherland-based company), under section 195 of the Income Tax Act, 1961 on the ground that the payment to the said company was in the nature of "Roy....
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....r hearing, Shri Dipen Sankhesara Advocate appeared and undertook to file Vakalatnama as well as written submission on behalf of the assessee. Therefore the case is adjourned to 16.06.2022. However on 16.06.2022, the Bench did not function and the case is adjourned to 13.07.2022. Today none appeared on behalf of the assessee. Except on 16.06.2022 none appeared on behalf of the assessee in all the previous hearings. Therefore with the material available on record and with the assistance of the Ld. D.R., we are required to proceed with the appeal. 5. The Ld. D.R. appearing for the Revenue submitted that the services rendered by the assessee is in the nature of Royalty and liable to deduct tax at source in respect of payment made to NEBU of ....
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....) and 201(1A) of the Act which were rightly done by the Assessing Officer, which has also been upheld by the Ld. CIT(A) thus does not require any interference and therefore the addition made by the A.O. is to be sustained and dismiss the present appeal filed by the assessee. 6. As stated in the preceding paragraph none appeared on behalf of the assessee and no written submissions is placed on record before us. Perusal of the records makes it very clear that the Ld. CIT(A) has considered the Hon'ble Madras High Court in the case of Verizon Communications Singapore Pte. Ltd.(cited supra) which is considered the amended provisions of Section 9(1)(vi) with Explanation 5, gives a very expansive meaning to the term 'Royalty' and this has a bea....
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....used directly by the payer; (c) the location of such right, property or information is in India. Explanation 6 -For the removal of doubts, it is hereby clarified that the expression "process" includes and shall be deemed to have always included transmission by satellite (including up-linking, amplification, conversion for down-linking of any signal), cable, optic fibre or by any other similar technology, whether or not such process is secret;" It is to be noted that both the definition of royalty under the Act and Tax Treaty includes the. term "use" or "right to use" industrial, commercial or scientific equipment and process. However, meaning to these terms is not provided in the Treaty. In view of the same, as pe....