9911796707
TMI Blog2024 (6) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... T (A) to be as a Royalty and 20 per cent tax deductable on the same has been wrongly imposed - HELD THAT:- The contention of learned counsel for the appellant that as the Royalty means consideration to be paid for imparting of any information concerning technical industrial commercial or scientific knowledge, experience or skill, we have to understand that the said imparting of any information has to be conveyed to the assessee. Since, the information which was gathered by the TPE at Russia was to be handed over to Russia alone and was not to be handed over to the assessee, we do not find the said consideration to come within the ambit of Royalty . Even as per explanation 5, it is clarified that royalty includes the possession and control o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax at the rate of 20% for the payments of Rs. 8,58,75,000/- to the Technoprom export (hereinafter to be referred as TPE ) and further directed the AO to grant refund to the assessee (State Trading Corporation) of the tax recovered from the assessee @ 20% from the payments made to the TPE. 2. Learned counsel for the revenue submits that ITAT has fallen in error in holding that the consideration paid for the preparation of the technical documentations, working designs, testing models of equipment and other technical purposes, would not fall within the definition of Royalty. 3. Learned counsel has taken to the definition of the word Royalty as defined under the provisions of Section 9 (Explanation 2, 3, 4 and 5) of the Income Tax Act, 1961 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for preparation of technical documentation, working drawings testing models of equipments and other technical purposes, has been wrongfully assesssed by the assessing officer as well as CIT (A) to be as a Royalty and 20 per cent tax deductable on the same has been wrongly imposed. 7. It is his submission that since the said expenditure incurred was not for the purpose of providing any information to the answering respondent, and was to be put to use at the territory of Russia alone and not to be handed over to the STC i.e petitioner, the said expenditure could not be treated as Royalty in terms of the provision as laid down in Section 9 Explanation 2, 4, 5 and 6 in fact it could be treated as capital assets purchased by the answering respon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 44-BB; (v) the transfer of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work including films or video tapes for use in connection with television or tapes for use in connection with radio broadcasting, but not including consideration for the sale, distribution or exhibition of cinematographic films; or (vi) the rendering of any services in connection with the activities referred to in [sub-clauses (i) to (iv), (iva) and (v)] Explanation 4- For the removal of doubts, it is hereby clarified that the transfer of all or any rights in respect of any right, property or information includes and has always included transfer of all or any right for use or right to use ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation taken by the CIT (A) and find that ITAT has succinctly examined the said aspect. 12. The contention of learned counsel for the appellant that as the Royalty means consideration to be paid for imparting of any information concerning technical industrial commercial or scientific knowledge, experience or skill, we have to understand that the said imparting of any information has to be conveyed to the assessee. Since, the information which was gathered by the TPE at Russia was to be handed over to Russia alone and was not to be handed over to the assessee, we do not find the said consideration to come within the ambit of Royalty . Even as per explanation 5, it is clarified that royalty includes the possession and control of such rights, p ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
