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TMI Blog2014 (8) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... PE in India - In the present case, there is no material to suggest that the recipient concerns have a permanent establishment in India or that they were present in India for a period exceeding 183 days during the previous year relevant to the assessment year under consideration. In this context, learned counsel for the assessee furnished appropriate certificates from the three recipient concerns tabulating the period for which their representatives were present in India during the relevant period which show that the presence in India was for less than 183 days. Therefore, on this aspect also, we find no merit in the plea of the Revenue and the discussion made by the CIT(A) in para 3.8 of his order in this context is hereby affirmed. As revenue CIT(A) has not considered the taxability of the impugned income as business income under Article 7 of the DTAA - Article 7 of the DTAA deals with business profits to be considered for taxation. The said Article states that the income or profits of the enterprise of a contracting State shall be taxable only in that State unless the enterprise carries on business in the other contracting State through a Permanent Establishment (PE) si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ten appeals, which is the subject-matter of the captioned proceedings. Initially, Revenue filed a single appeal by way of ITA No.2509/PN/2012 before the Tribunal challenging the consolidated order of the CIT(A). Subsequently, the Revenue has rectified the situation and filed ten separate appeals vide ITA Nos.1047 to 1056/PN/2014, raising identical Grounds of Appeal in all the appeals. This has resulted in a delay in filing of appeals by the Revenue. The delay in filing of the ten appeals by the Revenue vide ITA Nos.1047 to 1056/PN/2014 is condoned in view of the above circumstances and also in the absence of any objection from side of the assessee. In this background, the initial appeal filed by the Revenue vide ITA No.2509/PN/2012 is rendered infructuous because Revenue has rectified the situation and filed separate appeals corresponding to the appeals disposed-off by the CIT(A) in the impugned consolidated order. Accordingly, ITA No.2509/PN/2012 is dismissed as infructuous. 4. Now, we may consider for adjudication the appeals filed by the Revenue vide ITA Nos.1047 to 1056/PN/2014, wherein the issue is common and the following identical Grounds of Appeal have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidering the taxability of income from consultancy services as business income as per Article 7 or as technical services as other income as per Article 22 of the DTAA between India and Thailand. 5. The respondent-assessee is involved in the development and construction of a resort name, Sparsh Holistic Health Spa Resort, Pune. With a view to obtain professional services for designing and development of the resort, assessee entered into agreements with three non-resident concerns based in Thailand, namely, (i) KTGY Inter-Associates Ltd.; (ii) Light Wise Associates Co. Ltd.; and, (iii) Studio Fifty-Four Co. Ltd.. In terms of the agreement with KTGY Inter-Associates Ltd., assessee obtained services for Master Planning and Architectural Design for the resort; similarly, from M/s Light Wise Associates Co. Ltd., assessee obtained Professional Lightening related Design services; and, from M/s Studio Fifty-Four Co. Ltd., assessee obtained Interior Design services. Assessee made the following payments to the said concerns during the year under consideration after grossing-up the TDS amounts, which were duly remitted to the credit of the Central Government :- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of India and the Government of the Kingdom of Thailand. Thus, it approached the CIT(A) in terms of section 248 of the Act requiring the CIT(A) do declare that no tax was indeed deductible on such remittances to the foreign concerns. It was also asserted before the CIT(A) that the payees have not claimed any tax credit in their country, i.e. Thailand, because assessee did not issue the requisite TDS certificate to the payees. Thus, assessee contended that the tax deposited by it to the credit of the Central Government be refunded because such tax was not payable on the impugned payments. The CIT(A) has accepted the aforesaid plea, against which Revenue is in appeal before us, as per the aforestated Grounds of Appeal. 7. The first and foremost objection of the Revenue is that the appeals filed by the assessee before the CIT(A) were belated, and the CIT(A) has wrongly condoned the delay. The learned CIT-DR appearing for the Revenue referred to the Tabulation contained in para 1.4 of the order of the CIT(A) wherein the delay in filing of the appeals has been enumerated. According to her, the delay ranged from 832 to 933 days which according to her is an extraordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Limited vs. Nirmala Devi, 118 ITR 507 SC. in condoning the delay in filing of the appeals. In our considered opinion, though Revenue has challenged the action of the CIT(A) in condoning the delay, but nothing has been brought on record to suggest that the reasons advanced by the assessee before the CIT(A) were lacking in bona-fides. Therefore, the conclusion of the CIT(A) to condone the delay cannot be faulted. 10. Apart from the aforesaid, CIT(A) has observed that section 248 of the Act seeks to provide relief to taxpayers from unjust enrichment, and thus a liberal yardstick is to be adopted for judging the sufficient cause in such cases. Section 248 of the Act primarily deals with a situation where a person has deducted and paid tax to the Government, but thereafter denies his liability to deduct such tax. Thus, an appeal u/s 248 of the Act is preferred by a person only after he has actually paid the tax to the credit of the Central Government, whose liability he seeks to deny. In such a situation, where the bonafides of the assessee are not in challenge, the reasons advanced for the delay ought to be construed liberally. In conclusion, we hereby ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... greement with the Government of any country outside India for granting relief of tax, or as the case may be avoidance of double taxation, then, in relation to the assessee to whom such agreement applies, the provisions of the Act shall apply to the extent they are more beneficial to that assessee. Since the Indo-Thailand DTAA does not provide for taxability of fee for technical services in the case of the three recipients, who are residents of Thailand, the beneficial provisions of the DTAA shall prevail. In-fact, before us this aspect of the matter is also not in dispute. 13. However, Revenue has contended that the CIT(A) erred in considering that there is no separate Article in the DTAA to deal with fee for technical services . As per the Revenue, CIT(A) ought to have considered Article 22 of the DTAA which was a residual clause and that such clause covered the taxability of the impugned sums. In our considered opinion, the aforesaid plea of the Revenue is not justified. In situations like the present, it cannot be said that the impugned income is a miscellaneous income so as to justify invoking of Article 22 of the DTAA. The judgement of the Hon ble Madras Hi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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