Case Law Details
Rajesh Kumar Saroj Vs JCIT (ITAT Delhi)
The India-UK Treaty was entered into force on 26.10.1993 and because it is after 1.1.1990, the restricted scope provided in Indo-UK Treaty has to be read in the context of Indo-Spain DTAA. In so far as the reliance by the authorities on the decisions of AAR in the case of Steria (India) Ltd. (supra) is concerned, it is brought to our notice that in Steria (India) Ltd., vs. CIT (2016) 386 ITR 390 the Hon’ble Delhi High Court did not agree with the same. In this case, a similar protocol is there vide clause 7 in Indo-France DTAA pursuant to which the restricted meaning of ‘fee for technical services’ appearing in the Indo-UK DTAA was sought to be read as forming part of Indo-France DTAA as well. The Hon’ble Delhi High Court after considering the provisions of the DTAA of Indo –France, which are similarly worded as that of Indo-Spain held that less restrictive definition of expression ‘Fee for Technical Services’ appearing in Indo-UK DTAA, must be read as forming part of Indo-France DTAA as well.
We are, therefore, of the considered opinion that the decision of the Hon’ble Delhi High Court in Steria (India) Ltd., vs. CIT (2016) 386 ITR 390 and para 7 of the Protocol between India and Spain, the restrictive meaning of ‘Fee for Technical Services’ appearing in Article 13(4) (c ) Indo-UK DTAA must be read as forming part of Indo-Spain DTAA as well and, therefore, the payment made by the assessee to the Spanish company for fabric testing would not constitute fee for technical services and consequently, section 195 of the Act has no application to such a receipt.
FULL TEXT OF THE ITAT JUDGMENT
Aggrieved by the order dated 12.11.2015 in Appeal Nos. 107/269/13-14 passed by the Learned Commissioner of Income-tax(Appeals)-32, New Delhi {“CIT(A)”} for Assessment Years 2011- 12, assessee preferred this appeal.
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