‘Subscription fees’ received by assessee has to be assessed as ‘business income’ as per the provisions of DTAA between India and Singapore

By TG Team Income Tax Judiciary May 20, 2010

TaxGuru Citation: 2010 taxguru.in 719
Case Name: TIS Two Administration (Singapore) Pvt. Ltd. Vs. The Dy. Director of Income Tax (International taxation)2(1) (ITAT Mumbai)
Appeal Number: Only available for paid members
Date of Judgement/Order: Only available for paid members
Related Assessment Year: 1988- 89
Courts: ITAT Mumbai

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Whether the ld CIT(A) is justified in holding that the amount received by the appellant from the subscribers are in the nature of fees for technical services to the extent of subscription fees received for providing information/data on various products like financial/ forex/ commodity market and ‘royalty’ for use of equipment such as shared printer, matrix etc., and accordingly, entire receipts are liable to tax @ 20% on gross basis u/s 44D r.w.s 115A.

‘Subscription fees’ received by the assessee has to be assessed as ‘business income’ as per the provisions of DTAA between India and Singapore and the same cannot be treated as the fees for technical services or royalty for the use of the equipments like V-SAT, Printer etc. We further hold that the provisions of sec. 44D are not applicable.

IN THE INCOME TAX APPELLATE TRIBUNAL

MUMBAI BENCH ‘L’ MUMBAI

BEFORE SHRI P M JAGTAP, AM & SHRI R S PADVKAR, JM

ITA No. 8432/Mum/04 (Asst Year 1998- 99)

ITA No. 8433/Mum/04 (Asst Year 1999- 00)

ITA No. 5286/Mum/04 (Asst Year 2000- 01)

ITA No. 1385/Mum/05 (Asst Year 2001- 02)

TIS Two Administration (Singapore) Pvt. Ltd. (in Members” Voluntary Liquidation)

(Formerly known as Telerate (Asia Pacific) Singapore Pvt. Ltd.