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TMI Blog2020 (11) TMI 867X X X X Extracts X X X X X X X X Extracts X X X X ..... ear 2016-17. 2. The only issue raised in this appeal is against the taxability of certain receipts by the assessee as "Fees for technical services‟ within the meaning of Article 12 of India-Sweden Double Taxation Avoidance (hereinafter also called `the DTAA‟) read with India-Portugal DTAA (via Protocol). 3. Succinctly, the facts of the case are that the assessee is a Non-Resident Company incorporated in Sweden, who filed its return declaring Nil income. It rendered IT support services to four entities in India: Sandvik Asia Pvt. Ltd., Walter Tools India Pvt. Ltd., Seco Tools India Pt. Ltd. and Dormer Tools India Pvt. Ltd. for a total consideration of Rs. 27,16,79,590. Such amount was claimed not chargeable to tax as not fallin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r was pending before the Hon‟ble High Court, the AO came to hold for the instant year that the payment received by the assessee from SAPL was covered under Article 12 of the DTAA. Such amount of Rs. 25,61,71,850 was, therefore, held to be taxable. Similar view about taxability was taken qua the IT Support fees received by the assessee from the other three Indian entities. The assessee filed objections against the draft order before the DRP, who, vide its directions dated 27- 06-2019 noted the view taken by it in earlier years wherein the amount received from SAPL was held to be not chargeable to tax under Article 12 of the DTAA. However, considering the fact that the matter was pending before the Hon‟ble Bombay High Court in the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have noticed that for some of the earlier years, the Tribunal had an occasion to examine the nature of services rendered by the assessee and adjudicate the same, which decision finally went in favour of the assessee whereby it was held that the case was not covered by Article 12 of the DTAA and hence such receipts from SAPL were not taxable in India. On being called upon to demonstrate the nature of services rendered during the year, the ld. AR invited our attention towards an Agreement dated 01-04-2002 between Sandvik Asia Limited (now SAPL) and the assessee with its earlier name. It was submitted that the same Agreement as entered into in the year 2002 continued to govern the year under consideration as well. On a pointed query, the ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of the foregoing discussion, it is crystal clear that the amount received by the assessee from SAPL in the preceding/succeeding years has been either held by the Tribunal to be not chargeable to tax under Article 12 of the DTAA or the AO accepted the directions given by the DRP treating the same as not chargeable to tax or the AO himself treated such amounts as not chargeable to tax. As the facts and circumstances for the year under consideration are indisputably similar, we hold that sum of Rs. 25.61 crore received by the assessee from SAPL is eventually not chargeable to tax under Article 12 of the DTAA even though the same is in the nature of "Fees for technical services‟ covered u/s 9(1)(vii) of the Act. Thus, the issue is de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot facilitate the correct determination of the nature of services. This issue anent to Walter Tools India Pvt. Ltd. and Dormer Tools India Pvt. Ltd. came up for consideration before the Tribunal for the A.Y. 2013-14 wherein the matter stood remitted to the file of the AO for fresh determination of nature of services. Similar view has been reiterated by the Tribunal in its order for A.Ys. 2014-15 and 2015-16. A copy of this order is available at page 19 onwards of paper book. Since the facts and circumstances of the nature of receipt from three Indian entities in this year are admittedly similar to those of two entities in preceding years, respectfully following the precedent, we set aside the impugned order and remit the matter to the file ..... X X X X Extracts X X X X X X X X Extracts X X X X
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