2024 (11) TMI 315

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....case and in law the Ld. CIT(A) erred in directing the AO to delete the addition of Rs. 9,06,53,035/- made by AO on account of expenditure for IT service charges u/s 40(a)(ia) of the IT Act, 1961 treating such expense incurred by the assessee company as fees for technical services/royalty? 2. The Appellant prays that the order of the Ld. CIT(A) on the above ground be set aside and that of the Assessing Officer be restored. 3. The appellant craves leave to amend, or amend, or alter any ground or add a new ground, which may be necessary." 3. The facts of the case, in brief, are that the assessee is a domestic company and is engaged in the business of shipping agents. The original return of income was filed on 28.11.2014 de....

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....ssessment order, an appeal was preferred before ld. CIT(A), who vide impugned order dated 14.12.2023 allowed the appeal of the assessee, by following the order passed by the ITAT, Pune Benches, Pune in assessee's own case for the assessment year 2012-13 dated 02.01.2020. 5. Being aggrieved with the above decision of deletion of Rs. 9,06,53,035/- & Rs. 43,91,965/- by Ld. CIT(A), the Revenue is in appeal before this Tribunal and has only challenged the deletion of Rs. 9,06,53,035/- which was disallowed by the AO u/s 40(a)(ia) of the IT Act. 6. During the course of hearing, ld. DR submitted before us that the order passed by ld. CIT(A) is not correct and requested to treat the payment of Rs. 9,06,53,035/- as fees for technical services, ....

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.... 'or' and not the word 'and' has been used between the clauses (a) and (b) of Article 12(4) of the DTAA with Portuguese. He held the case of the assessee to be falling under clause (a). Thus it is seen that the ld. CIT(A) admitted that the clause (b) is not attracted to the facts of the instant case because CMA CGM, France did not make available any technical knowledge, experience or skill etc. to the assessee. In so far as clause (a) is concerned, it talks of any payment for services which are ancillary and subsidiary to the application or enjoyment of the right, property or information for which payment described in paragraph 3 is received. It is only if the services ancillary to the enjoyment of right, property or information as per para....