Case Law Details
Google India Pvt. Ltd Vs DCIT (ITAT Bangalore)
Held that show cause notice to initiate proceedings u/s. 201(1) is issued on 20.11.2012 which is beyond four years with respect to assessment years 2007-08 & 2008-09. Accordingly, interest levied u/s 201(1A) unsustainable.
Facts-
The assessee has entered into Google Adword Program Distribution Agreement dated 12.12.2005 with Google Ireland Ltd. (GIL). As per the agreement, the assessee is appointed as a non-exclusive authorized distributor of Adword Programs to the advertisers in India. Accordingly, the assessee is liable to pay distribution fees to GIL.
However, the payment was made without deduction of tax at according to the assessee, it was mere reseller of the advertising space made available under the Adword Program distribution agreement and the assessee is distributor of advertising space with no access or control over the infrastructure or the process that is involved in rendering the Adword Program. Therefore, the sums so paid were not chargeable to tax under the relevant Double Taxation Avoidance Agreement [DTAA]. Accordingly, there was no deduction of tax on such payments in the absence of primary charge of tax.
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