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TMI Blog2022 (10) TMI 1049X X X X Extracts X X X X X X X X Extracts X X X X ..... ature alleging to be included as technical and consultancy services for the purpose fees for included service as per sub-clause 4B of Article 12 of DTAA between India USA. While undertaking the above services, the assessee had not executed any contract to make anybusiness. So, as to use services independently by applying the technology. All the services undertaken by the assessee or either support service IT enable services; co-ordination of tax services as rendered above are not stage which request transfer of technology receipts to skill company. We are fully relied on the order of the coordinate bench in this issue and the addition amount - Decided against revenue. - I.T.A. Nos. 160 to 162/Mum/2022 - - - Dated:- 27-10-2022 - Shri Pramod Kumar, Vice-President And Sh. Anikesh Banerjee, Judicial Member For the Appellant : Sh. Soumendu Kumar Dash, DR For the Respondent : Sh.Paras Savla/ Pratik Poddar, AR. ORDER PER:ANIKESH BANERJEE, JM: The batch of three appeals were filed by the revenue directed against the order of the ld. Commissioner of Income Tax(Appeal)-55,Mumbai, [in brevity the CIT(A)] bearing appeal No. Din Order No. ITBA/APL/S/250/2021- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny established under the laws of Delaware USA and has registered office in New York. AC Nielsen Group is one of the leading business and information companies in the world andis represented in India through two legal entities namely ACNielsen Org Marg Pvt. Ltd.(in brevity ACNOM) for customized research services and retail measurement services ACNielsen Research Services Pvt. Ltd. (in brevity ACNRS) for rendering services in the fieldof commercial, financial, accounting and legal, logistics etc. In the year of appeal a sum of Rs.15,06,52,986/- was received from Indian entities for the services which was claimed exempted under Article 12 of India-USA DTAA. 3.1 In the original assessment order, the ld. AO taxed entire income, 50% as royalty and 50% as fees for included services (FIS). It was upheld by CIT(A). However, matter has been sent back to the file of AO for fresh adjudication by Hon ble order of ITAT vide order dated 02.03.2016. The AO has passed order as per the directionof the ITAT on 14.02.2018, taxing entire amount of Rs. 15,06,52,986/- as fees for included services (FIS). The assessee has filed appeal against the order of the ld. AO before the ld. CIT(A). The ld. CIT(A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h is reproduced as follows: ACNielsen Corporation ( ACNielsen/ the appellant company ) is a company established under the laws of Delaware, USA having its registered office at 770 Broadway, NY 10003-9595, New York, USA. ACNielsen is one of the world s leading business information companies and has leading market positions in marketing and media information, directories and consumer information, as well as educational information. The ACNielsen Group also offers other marketing information services tailored to industries such as pharmaceuticals, financial services and telecommunications. The ACNielsen Group is represented in India through its two legal entities i.e. ACNielsen Org- Marg Private Ltd. ( ACNOM ) for customized research services retail measurement services and ACNielsen Research Services Pvt. Ltd. ( ACNRS ) for customized market research services. ACNielsen has entered into General Service Agreement ( GSA ) dated 2 June 2003 with ACNOM and ACNRS ( collectively referred as the Indian entities ) for rendering of services in the field of commercial, financial, accounting and legal matters, logistic, developing and engineering, sales and marketin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... separate payment towards software products/ analytical tools either to its regional office/ vendors directly. Disregarding the above explanations of ACNielsen, the DDIT treated 50% of the receipts of Rs. 15,06,52,986 as income in the nature of royalty taxable as per Article 12(3)(a) and remaining 50% as income in the nature of fees for included services , taxable as per Article 12(4)(a) in India @ 15%. Aggrieved by the order of the DDIT, the appellant company is in appeal before your honour. 5.3 The ld. Counsel further relied on the order of the ld. CIT(A) in para 5.2.3 which is extracted as below: 5.2.3 The appellant has submitted that Hon ble ITAT has decided the issue in its favour for A.Y. 2004-05, 2005-06 and 2006-07 on the same set of facts and circumstances, vide common order dated 22.07.2019. It is noticed that identical grounds were raised in those years. The Hon ble Tribunal followed its decision for A.Y. 2010-11 in the case of in The Nielsen Company (US) LLC in ITA no. 4360/Mum/2015 dated 22.05.2019. I have perused the GSA dated 02.06.2003 between appellant and ACNielsen ORG-MARG Limited which was applicable for A.Y. 2004-05, 2005-06 and 2006 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... technical and consulting services made available are technical knowledge, experience, skill, know howor process orconsistthe development and transfer of a technical plan or technical design are considered to be technical or consultancy services. 6.1 It is also clarified that consultancy services not of technical nature cannot fall under Included Services . In view of this memorandum of understanding between two sovereign countries, the consultancy services which are technical in nature alleging to be included as technical and consultancy services for the purpose fees for included service as per sub-clause 4B of Article 12 of DTAA between India USA. The services provided by the assessee consist of. i) Development and determination of short-term business strategies. ii) Overall management and co-ordination in relation to general policies and strategies per country perdivision. iii) Maintenance of external relationship, to the extent that these services do not compromise shareholder services. iv) Humanresource services regarding group policy. v) Legal consultant services. vi) Insurance services. vii) Development, control and maintenance of management informat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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