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TMI Blog2017 (4) TMI 1436X X X X Extracts X X X X X X X X Extracts X X X X ..... es did not partake of the character of fees for technical services as defined in the Explanation to Section 9(1)(vii)(b) . The issue is squarely covered by the decision of Bangalore bench in case of ABB FZ-LLC [ 2016 (11) TMI 368 - ITAT BANGALORE] and also by the decision in case of Mckinsey Business Consultants [ 2015 (2) TMI 683 - ITAT MUMBAI ] Payment of fees by assessee s bank to Amas Bank is not liable to tax in India and the tax already paid be refunded to assessee. In terms of paragraph 4 of the Agreement (Annexure 1 hereto), so entered by assessee, the payment of fees shall be free, inter alia, of any withholding tax, meaning thereby that such tax was to be borne by the assessee under the Agreement, thus the basis condition fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to fees for technical services, the same would not be taxable even as per Article 22 of the Tax Treaty. 3. Rival contentions have been heard and record perused. 4. Facts in brief are that the assessee is a scheduled Bank duly registered and carrying on the business of banking under the Reserve Bank of India Act and Banking Regulation Act of India. For the purpose of expanding its banking business activities and also for meeting other capital needs, the Bank felt the need to raise capital abroad through the issuance of Global Depository Receipts (GDRs). After considering various option and evaluating the cost as well as benefits of raising such capital through GDRs the assessee decided to engage Amas Bank (Middle East) Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oned and certified deduction of tax at source of USD 2,13,722 equivalent to ₹ 90,83,185/- being the amount of tax grossed up @ 10.5575%, the assessee contended that no tax was payable at all under section 195 of the Act. 6. In view of the above discussion, we do not find anything wrong in asessee s denial of its liability to pay tax u/s.195 of the IT Act. In respect of the amount payable to AMAS Bank UAE, we also found that the services rendered by Amas Bank were purely of a commercial nature and bore the character of income arising to it wholly outside India, emanating from commercial services rendered by the Bank in the course of carrying on of its business wholly outside India. Services under the Agreement with Amas Bank w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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