TaxTMI 
TaxTMI 
2024 (7) TMI 885
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....amme, Reservation Fee and Marketing Fee amounting to INR 33,11,70,181/-. 1.1. That on the facts and in the circumstances of the case and in law, the Ld. AO erred in making addition and the Ld. DRP erred in confirming addition to the income of the Appellant in relation to receipts for Loyalty Programme, Reservation Fee and Marketing Fee amounting to INR 33,11,70,181, ignoring the detailed factual and legal submissions furnished by the Appellant. 1.2. On the facts and in circumstances of the case and in law, the Ld. AO erred in treating and the Ld. DRP erred in confirming receipts on account of Loyalty Programme, Reservation Fee and Marketing Fee as Royalty/Fee For Technical Services ('FTS') under the Act and under Article 12 of I....
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....dia-Singapore Double Taxation Avoidance Agreement ('DTAA'/ 'Tax Treaty'). The assessee is a non-resident corporate entity incorporated in Singapore and is a tax resident of Singapore. The assessee is subsidiary of Accor Asia SA, Belgium and acts as a franchisor and/or owner of participating hotels in the Asia Specific Region including India and has the license to use the brand name Accor and Novotel in the region. The assessee entered into franchise agreement with AAPC India Hotel Management Pvt. Ltd. (AAPC India) and Economic Hotels India Pvt. Ltd. (EHIS) to sub-license the brand names to third party hotels in India. The assessee has also sub licensed certain other Accor Intellectual Property Rights (IPR) to another group e....
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....tated services neither can be treated as royalty nor FTS under the treaty provisions. The Assessing Officer was, however not convinced with the submissions of the assessee. He observed that, though, assessee had entered into two separate agreements, one for use of brand name and the other for provision of certain services, however, the agreements are composite in nature as the services rendered by the assessee are ancillary and subsidiary to the application or enjoyment of right, property or information for which the assessee received license fee. He further observed that the amount received for services rendered in connection with use or right to use any trade mark falls within the scope of royalty. Thus, based on the aforesaid reasoning, ....
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....ins same, the DRP doesn't see any reason to review the directions issues in the previous year. The objections on these issues by the assessee are rejected" 6. During the course of hearing, the ld. AR submitted that both the AO as well as the DRP have followed their respective findings/directions on these issues for AY 2015-16. The ld. AR further submitted that the co-ordinate Bench in the case of the assessee in ITA No.581/Del/2023, for AY 2015-16 vide an order dated 29.12.2023 has decided the appeal in favour of the assessee and deleted the additions on all the above three issues. It was also submitted that there has been no assessment in the case of the assessee for the assessment year 2016-17 to 2019-20. 7. The ld. DR relied upon t....
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....8/Del/2023 decided by us in earlier part of this order. Therefore, our above decision would apply mutatis-mutandis to this ground of the appeal. 14. Ground no.3 of the appeal is against the computing of gross tax liability at incorrect rates (inclusive of surcharge and education cess) without taking into consideration, the applicable tax rates as per India Singapore DTAA in the computation sheet accompanying the final assessment order u/s 143(3). The AO is directed to verify the above grievance of the assessee and apply the correct tax rate in accordance with law. Ground no.3 is allowed for statistical purposes. 15. Ground no.4, the assessee has raised the issue of short grant of TDS amounting to Rs. 18,92,461/-. The AO is directed to ver....