TaxTMI 
TaxTMI 
2019 (10) TMI 1543
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....s 144C(13) r.w.s. 143(3) pursuant to the directions of Ld. Dispute Resolution Panel-II, Mumbai ['DRP'] u/s 144C(5) dated 24/09/2018. The income of the assessee has been determined at Rs.16.16 Crores as against Nil return e-filed by the assessee on 25/11/2014. 2. During hearing before us, it is admitted position that the issue under appeal squarely stood covered in assessee's favor by various decisions of this Tribunal right from AYs 2006-07 to 2013-14, the copies of which has been placed on record. The lead order of the Tribunal is for AY 2006-07 ITA No. 3160/Mum/2010 & Co.No.17/Mum/2011 dated 30/12/2011 which has been followed in subsequent years. The details of Tribunal's order, for ease of reference, could be tabulated in the followin....
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.... perusal of terms of agreement dated April,2009 observed that the income being earned by the assessee was dependent on revenue which were being generated from distribution of films in India and the assessee was entitled for certain percentage of gross revenues earned from distribution of films in India. Therefore, the income, in reality, would be business income and not royalty as contended by the assessee. In the above background, Ld. AO, after appreciating the provisions of Section 5(2), reached a conclusion that the provisions of Section 5 were clearly applicable to the facts of the case and stated income directly accrued in India from exhibition of films in the cinema halls / TV channels in India. 3.2 Additionally, the stated income,....
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....e assessee and accordingly an amount of Rs.16.16 Crores was brought to tax as business profits of the assessee in draft assessment order dated 18/12/2017 which was subjected to objections before Ld. DRP. 4. Aggrieved, the assessee raised objections before Ld. DRP, inter-alia, by drawing attention to the fact that this issue was covered by the orders of Tribunal's in assessee's own case in earlier years. However, it was observed that the proceedings before Ld. DRP were continuation of assessment proceedings only and DRP was not an appellate authority and therefore, since the department was under appeal in earlier years before Hon'ble Bombay High Court, the view of Ld.AO was to be upheld. Resultantly, finally assessment order was passed on....
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....ed by the assessee cannot be considered as royalty as was done by the Assessing Officer while invoking the Article 12(2) of the DTAA for taxing the amounts. To that extent the findings of the CIT (A) are correct and there is no need to deviate from such findings. In view of this the amount received by the assessee cannot be considered as royalty within the meaning of Indian Income Tax Act or under the DTAA. 10) The issue can be examined in another dimension whether the amount is taxable under the Indian Income Tax Act in India if not as royalty, but as business income. The CIT (A) finding is that assessee has a business connection in India. However, he considered that there is no PE to the assessee, the fact of which was also accep....
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....lied on the decision of Ishikawajma-Harima Heavy Industries Ltd vs. Director of Income Tax 2007-(158)-TAXMAN 0259-SC that incomes arising to a Non-Resident cannot be taxed as business income in India, without a PE. As the assessee does not have any permanent establishment in India, the incomes arising outside Indian Territories cannot be brought to tax. Therefore, there is no need to differ from the findings of the CIT (A) and accordingly the Revenue Appeal is dismissed. 12) In the cross objection, the assessee is contesting about the findings of the CIT (A) that the general principles of section 9(1)(i) will apply in the absence of inclusion under section 9(1)(vi) and relied on the two decisions of the Gujarat and Madras High Cour....