9911796707
TMI Blog2013 (3) TMI 554X X X X Extracts X X X X X X X X Extracts X X X X ..... ingapore Tax Authorities in respect of the Global Operations, in which substantial loss is reflected. On a perusal of the same it is clear that the appellant has indeed incurred huge losses. Therefore the margin of 30% applied by the Assessing Officer seems to be very high. - Estimation of profit reduced from 30% to 10%. - Decided partly in favor of assessee. Interest u/s 234B for failure to pay advance tax - held that:- issue is squarely covered in favour of the assessee and against the Revenue by the decision of Hon’ble Bombay High Court in the case of Director of Income Tax (International Taxation) vs. NGC Net Work Asia LNC [2009 (1) TMI 174 - BOMBAY HIGH COURT] wherein it was held that when the entire income of non resident assessee was liable for deduction of tax at source by the payer, there was no obligation on the payee to pay advance tax in respect of his income and no interest u/s 234B, therefore, could be charged. - Decided in favor of assessee. - ITA Nos.3530,3856/Mum/2006, ITA Nos. 2341,3410,2497,3989/Mum/2007, ITA Nos. 5212,5368/Mum/2009 & CO No. 87/Mum/2010. - - - Dated:- 31-1-2012 - Shri P.M. Jagtap and Shri N.V. Vasudevan, JJ. Assessee by : Shri A.V ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d not have earned any income from India but for its Indian agent MTV India (P) Ltd. According to him, the brand name used by the assessee company was the same as that of its agent in India, the income stream of the assessee company was only from selling of advertising time which were sold by MTV India (P) Ltd. and even the payments were also collected by MTV India (P) Ltd. for further remittance to Singapore. The AO held that the case of the assessee thus was covered by Article 5(1) of India Singapore Treaty since its business was carried out through a fixed place in India wherein the agent was to carry all the functions in India and in effect was a virtual projection of the assessee in India. The AO held that the assessee company thus had an agency PE in India during the years under consideration. He also held that even if arm s length remuneration was paid by the assessee company to dependant agent, further profits could be attributed to the agency PE in India being the Source country . He noted in this context that the only source of revenue of the assessee in India was through sale of advertising time wherein the Indian dependant agent had a major role. For this reason as we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ore us, the learned counsel for the assessee, however, has not pressed this ground. The same is accordingly dismissed as not pressed. 6. In ground No. 1 of all its four appeals, the Revenue has challenged the action of the learned CIT(Appeals) in holding that the assessee company had no fixed place PE in India during all the four years under consideration. Keeping in view that the assessee has accepted the existence PE in India by not pressing ground No. 1 raised in its appeal, the learned DR has not raised any material contention challenging the decision of the learned CIT(Appeals) holding that the assessee company did not a fixed place PE in India during all the four years under consideration. Accordingly the decision of the learned CIT(Appeals) on this issue is upheld and ground No.1 raised in all the four appeals of the Department is dismissed. 7. The next common issue raised in ground Nos. 2 to 4 of the assessee s appeals for assessment years 2002-03, 2003-04 and 2004-05 and in ground No. 2 and 3 of the departmental appeals for assessment years 2003-04 and 2004-05 as well as in ground No. 2 of Revenue s appeal for assessment year 2005-06 relates to the determination of adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lier, accounts of MTVA for the year ended 31 December 2002 were audited subsequently. Further separate set of books of Indian Operations have not been maintained, therefore it is considered proper to apply Rule 10(i) read with Rule 10(iii). 5.19 As stated earlier, considering the verifiability of purchase of programmes and transponder charges the margin of the appellant comes to 0.85% ignoring all other expenses. Further the appellant has filed copies of tax computations file with Singapore Tax Authorities in respect of the Global Operations, in which substantial loss is reflected. On a perusal of the same it is clear that the appellant has indeed incurred huge losses. Therefore the margin of 30% applied by the Assessing Officer seems to be very high. Further, it is quite obvious that the appellant must have incurred various other administrative and operating expenses. 5.20 In the case of purchase of programmes, though most of these programmes appear to have relation to India only, it cannot be said that these programmes have not been viewed by the Indian viewers in other countries (especially neighbouring countries) when MTV Channel is telecasted. There is no positive evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see s appeal for assessment year 2003-04 and 2004-05 and ground Nos. 2 and 3 of Revenue s appeal for assessment years 2003-04 and 2004-05 are dismissed. Ground No. 2 of the Revenue s appeal for assessment year 2005-06 is partly allowed. 10. Ground Nos. 6 and 8 of the assessee s appeal for assessment year 2002-03 and ground No. 6 of assessee s appeal for assessment year 2003-04 relating to the levy of interest u/s 234D have not been pressed by the learned counsel for the assessee at the time of hearing before us. The same are accordingly dismissed as not pressed. 11. The next issue relating to interest charged by the AO u/s 234B and confirmed by the learned CIT(Appeals) is raised in the following grounds of the assessee s appeals: Asstt. Year Ground No. 2002-03 7 2003-04 5 2004-05 5 2005-05 3 12. At the time of hearing before us, the learned representatives of both the sides have agreed that this issue is squarely covered in favour of the assessee and against the Revenue by the decision of Hon ble Bombay High Court in the case of Director of Income Tax (International Taxation) vs. NGC Net Work Asia ..... 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