2019 (2) TMI 1963 - AT - Income Tax

Income taxable in India - balance receipts not attributable to PE in India - IPL matches - receipts from the board of control for Cricket in India - period of stay of employees in India - whether the balance receipts not attributable to permanent establishment of the assessee can be taxed as fees for technical services under Article-13 of the India-UK Tax Treaty? - assessee is a company Incorporated under the laws of United Kingdom - HELD THAT - The assessee and board of control for Cricket in India entered into an arrangement, contract for establishment, commercialization and operation of the Indian Premier league in September 2007. The assessee entered into an initial contract and subsequent separate service agreement for the services to be provided to the board of control for Cricket in India in relation to IPL. For the purpose of provision of the services it deputed some of its employees for undertaking the on ground implementation and elated supervision activities in India. The stay of these employees has exceeded the threshold limit of 90 days in India and hence the assessee was having a permanent establishment under article 5 of the DTAA. The assessee attributed 63% of the total receipts from the board of control for Cricket in India as attributable to such PE and balance receipt of 37% was held to be not taxable in India. This was the stand taken by the assessee. According to that the receipt were not taxable in India. AO held that the above sum is taxable as fees for technical services. As accepted by both the parties the above issue is squarely covered against the assessee by the decision of the coordinate bench in assessee‟s own case for assessment year 2010 11 2016 (11) TMI 65 - ITAT DELHI as well as for assessment year 2011 12 to 2014 15 2018 (5) TMI 2089 - ITAT DELHI

Summary

Issues:
1. Early hearing request based on issue of taxability of receipt as fees for technical services under tax treaty.
2. Consideration of early hearing request.
3. Taxability of receipts from services provided in India.
4. Application of previous decisions by coordinate bench.
5. Dismissal of appeal based on precedent.

Analysis:
1. The assessee filed an appeal for assessment year 2015-16 seeking early hearing on the issue of whether receipts not attributable to a permanent establishment can be taxed as fees for technical services under the India-UK tax treaty, citing a previous decision by the coordinate bench in their own case for earlier years.

2. The application for early hearing was supported by both the authorized representative and the departmental representative, with no objections raised, leading to the grant of early hearing by the tribunal based on the issue's coverage in the previous decision.

3. The case involved a non-resident foreign company from the UK providing services in India, with the dispute arising from the taxability of receipts from services provided to the Board of Control for Cricket in India, where the assessee claimed a portion of the receipts as not taxable due to the absence of a permanent establishment.

4. Both parties acknowledged that the issue was previously decided against the assessee by the coordinate bench for earlier assessment years, leading to a consensus to follow the previous decisions in the present appeal, which was then heard accordingly.

5. After considering the arguments, the tribunal found that the issue was indeed covered against the assessee by the decisions of the coordinate bench in the assessee's own case for earlier years. Consequently, the appeal was dismissed based on the precedent set by the previous decisions, leading to the dismissal of the appeal for assessment year 2015-16.