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TMI Blog2023 (3) TMI 510X X X X Extracts X X X X X X X X Extracts X X X X ..... in IT(IT)A No.7/Bang/2018 which are as follows: 1. The Order is bad in law and on facts 1.1 The Order passed by the Ld. CIT(A) under section 250 r.w.s 201(1) and 201(1 A) of the Act, is bad in law and on facts. 2. Erroneous dismissal of appeal filed before the Ld. CIT(A) 2.1 The Ld. CIT(A) failed to appreciate that the favorable ITAT order dated 10 March 2022 passed in case of the Appellant for AY 2009-10 was in respect of regular assessment proceedings, and not against the TDS proceedings under section 20 1 ( 1 ) and 20 1 ( 1 A) of the Act for AY 20 1 0- 1 1 . 2.2 Consequentially, the Ld. CIT(A) erred in holding that there remained no issue for adjudication. Therefore, the Ld. CIT(A) erred in treating the appeal as infructuo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2.3 Examination of payments made by the assessee to CGTM, France reveals that the payments were made without deduction of tax at source for availing the technical assistance. Further CGTM, France had also not filed any application before the Department for lower or NIL rate of deduction of tax at source. No application was also filed neither by the assessee nor by CGTM, France before the AAR seeking a ruling on the issue of deduction of tax at source on the payments made to CGTM, France for payment made towards technical assistance. 2.4 As per the provisions of Sec.195 of the Income-tax Act,1961 ['the Act' for short], any person responsible for paying to a non-resident, not being a company, or to a foreign company, any int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A No.83/Bang/2018 with regard to disallowance u/s 40(a)(ia) of the Act in respect of non IT( deduction of TDS in that assessment year on the same issue as in the present case for non-deduction of TDS. Thus, he submitted that in ITA No.83/Bang/2018 vide order dated 10.3.2022, the Tribunal held as under: "11. We have heard both the parties and perused the materials on record. The nature of service rendered by CGTM France to the assessee needs to be examined. The ALH Shakti Engine was co-developed by Turbomeca (a company based at France) and the assessee and the assistance for conducting flight tests were provided by CGTM France a subsidiary of Turbomeca. The perusal of the details of technical services provided by CGTM France to the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsidering a similar issue has held that "To be said to "make available", the service should be aimed at and result in transmitting technical knowledge etc so that the payer of the service could derive an enduring benefit and utilize the knowledge or know-how on his own in future without the aid of the service provider. In other words, to fit into terminology "making available", the technical knowledge, skills" etc must remain with the person receiving the service even after the particular contract comes to an end. It is not enough that the services offered are the product of intense technological effort and a lot of technical knowledge and experience of the service provider has gone into it. The technical knowledge or skills of the prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. After hearing both the parties, we are of the opinion that there is merit in the argument of ld. A.R. since the Tribunal has already held that there was no question of deduction of TDS on the payment made to CGTM, France for the service rendered by them to the assessee and the payment made to them does not fall under the "fees for technical service." Hence, it does not attract the provisions of section 195 of the Act so as to deduct TDS. Accordingly, we allow the grounds taken by the assessee on the same issue as stated in the order of the Tribunal cited (supra) in both the appeals.
5. In the result, both the appeals of the assessee are allowed.
Order pronounced in the open court on 20th Feb , 2023. X X X X Extracts X X X X X X X X Extracts X X X X
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