9911796707
TMI Blog2022 (10) TMI 1171X X X X Extracts X X X X X X X X Extracts X X X X ..... ns of the Tax Treaty. The Company is engaged in providing market research reports on pharmaceutical sector to its Customers across the globe at a predetermined subscription price. The Company mainly collects, process and utilize the data and information, particularly in the fields of medicine and pharmaceuticals for the delivery of reports through online IQVIA Knowledge link. The Company enters into an Agreement with its Customers for providing the Review Reports ('IQVIA Reports). The Agreement sets out the details of the modules that are required by the Customers and permitted to be accessed with applicable fees. The IQVIA Reports based on Modules selected, are statistical database compilations, which provide geo-economical data about a pharma molecule (medicine) thereby providing insights into the economic and political issues affecting the pharmaceutical and healthcare industries in a jurisdiction. The IQVIA Reports are akin to a magazine that provide latest information and developments and it relates to database, information etc. relevant to the Pharmaceutical industry. Further, IQIVA Reports are standard data reports of the Module selected by Customers. For the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble. The Assessing Officer passed a draft Assessment Order with the observation that ITAT has granted relief to the assessee for A.Y. 2013-14 to A.Y. 2015-16 and department has preferred an appeal before Hon'ble High Court which is pending for adjudication. Therefore, the assessee's claim that the revenue earned from its Indian clients does not constitute royalty is not accepted and accordingly gross receipt of Rs..44,34,93,451/- is taxable as Royalty and considered as income for this assessment year. Aggrieved, assessee preferred an appeal before the Dispute Resolution Panel and Ld. DRP decided the issue against the assessee. 4. Aggrieved assessee preferred appeal before us raising following grounds in its appeal: - "Ground No. 1- Non-taxable business income of Rs.44,34,93,451/- in the nature of Subscription Fees for standard online market research database on pharmaceutical sector taxed as Royalty under Section 9(1)(vi) of the Income-tax Act, 1961 (the Act) and under Article 12(3) of the India- Switzerland Tax Treaty (Tax Treaty") 1. On the facts and in the circumstances of the case and in law, the Ld. Assessing Officer (AO)/ Dispute Resolution Panel (DRP) erred in conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he immediate previous A.Y. 2016-17 in ITA.No. 1203/Mum/2021 dated 11.05.2022 which is placed in Page No.161 of the Paper Book. Ld. AR prayed that the same be adopted for the year under consideration. 6. On the other hand, Ld.DR vehemently argued and relied on the orders passed by the lower authorities. 7. Considered the rival submissions and material placed on record, we observe that Coordinate Bench in assessee's own case in ITA.No.1203/Mum/2021 dated 11.05.2022 for the A.Y. 2016-17 in the immediate previous assessment year held as under: - "10. We have considered the rival submissions and perused the material available on record. We find that the Co-ordinate Bench of the Tribunal in assessee's own case in IMS AG (now known as IQVIA AG) v/s DCIT, in ITA no.6445/Mum./2016, vide order dated 13.07.2020, for the assessment year 2013-14, while holding that subscription fees received by the assessee is not taxable as Royalty under the provisions of DTAA, observed as under:- "3. To adjudicate on this appeal, only a few material facts need to be taken note of. The assessee before us is a company incorporated, and fiscally domiciled, in Switzerland. The assessee company is engaged i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al, the Income-tax Appellate Tribunal set aside the order passed under section 195 read with section 201 of the Act by following its decision in the assessee's own case for the assessment year 2002-03 in I.T.A. No. 1773/Mum/2006 and the decision of the Authority for Advance Rulings on identical facts in the case of Dun and S.A. Bradstreet Espana In re Authority for Advance Rulings No. 615 of 2003 [2005] 272ITR 99 (AAR)), D and B Europe Authority for Advance Rulings No. 657 of 2005, dated October 27, 2005, and D and B UK Authority for Advance Rulings No. 656 of 2005, dated October 27, 2005. In all these cases the Authority for Advance Rulings held that the sale of very same business information reports by the subsidiaries of Dun and Bradstreet US in Spain, Europe and V. K. to the assessee did not attract the provisions of section 195 of the Act. Though the decision of the Authority for Advance Rulings is not binding in the present case, since the decision of the Authority for Advance Rulings relates to the very same business information reports imported by the petitioner and no fault in the decision of the Authority for Advance Rulings is pointed out, we see no reason to interfe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ountry, can a supply of such information electronically on payment of price be treated as royalty or fee for technical services ? We think not. The next case relied upon by the Commissioner is also a ruling of the Authority in Ericsson Telephone Corpn. India AB, In re [ 1997] 224ITR 2031. In that case the applicant was a company incorporated in Sweden. It provided, inter alia, services within radio and telecommunication. It entered into contracts with three Indian companies for the introduction of the cellular system of telecommunication in India and opened branch offices in India at New Delhi, Bombay and Madras. The Indian company informed applicant that while making payments under the agreement they would withhold income tax at 55% as provided in the Finance Act, 1995. According to the applicant tax deduction could not have exceeded 5,5% of the gross payments, as the net profit on the contract would not be more 10%, It was, therefore, not a case of whether the amount paid could be termed as fee for technical services. It was admittedly a case of payment of fee for technical services. For the abovementioned reasons, payments made by the DBIS to the applicant for purchases of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Co- ordinate Bench of the Tribunal in assessee's own case in IMS AG (now known as IQVIA AG) v/s DCIT, in ITA no.7291/Mum./2017, vide order dated 13.07.2020, for the assessment year 2014-15. The learned Departmental Representative could not show any reason to deviate from the aforesaid orders and no change in facts and law was alleged in the relevant assessment year. The issue arising in the present appeal is recurring in nature and has been decided in favour of the assessee by the decision of the Co-ordinate Bench of the Tribunal for preceding assessment years. Thus, respectfully following the orders passed by the Co-ordinate Bench of the Tribunal in assessee's own case cited supra, we uphold the plea of the assessee and delete the impugned addition in respect of subscription fees received by the assessee. As a result, ground nos. 1(1) to 1(4), raised in assessee's appeal are allowed." 8. Since the issue is exactly similar and grounds as well as the facts are also identical, respectfully following the above decision in assessee's own case for the A.Y. 2016-17 and also following rule of principle of consistency, we allow the ground raised by the assessee. 9. With regard to Ground ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
