GODADDY.COM,LLC,GURGAON V. ACIT, CIRCLE INT. TAX. 1(3)(1), DELHI

SA 57/DEL/2025

AI Insights

The case involves M/s Go Daddy.com, LLC, the appellant, contesting a tax demand for the Assessment Year 2022-23, which arose from the denial of Treaty benefits and the classification of certain service receipts as royalty under the India-U.S. Tax Treaty. The tax authorities also classified non-domain services fees as taxable under FTS/FIS. The Tribunal noted that similar issues had been decided in favor of the assessee in previous years and that the Department was appealing a related decision to the Supreme Court. The Tribunal decided to stay the demand, emphasizing the likelihood of financial hardship to the assessee and the absence of a compelling case for requiring a deposit of 20% of the disputed demand.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 474567 (ITAT-DELHI)
• Appeal Type: Stay Application
• Pronouncement Date: 31-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Assessment Year: 2022-2023
• Other Referred Cases: ITA No.1558 to 1561/Del/2022, ITA No.3027/Del/2023
• Laws Referred To: India-U.S. Tax Treaty
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR DHANISTA
• Assessee Lawyers: RAVI SHARMA; SHRUTI KHIMTA
• Keywords: Application of stay

Judgement Text

" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: ‘D’ NEW DELHI BEFORE SHRI ANUBHAV SHARMA, JUDICIAL MEMBER AND SHRI NAVEEN CHANDRA, ACCOUNTANT MEMBER S.A. No.57/Del/2025 [Arising out of ITA No.335/Del/2025] Assessment Year: 2022-23 M/s Go Daddy.com, LLC, Registered Officer: 2155, E Go Daddy Way, Tempe, AZ 85284 Vs. Asst. CIT, Circle-1(3)(1), New Delhi. PAN: AAACG7133K (Appellant) (Respondent) ORDER PER ANUBHAV SHARMA, JM: Application in hand has been filed by the assessee for the stay of demand for Assessment Year 2022-23. 2. On hearing both sides, it comes up that the disputed tax demand arises out of denial of Treaty benefit to the assessee and holding domain name registration and transfer of services receipts as royalty under the India-U.S. Tax Treaty. Further, the Ld. Tax Authorities have held that non-domain services fee is taxable as FTS/FIS. Ld. Counsel has drawn our attention to the fact that in Assessee by Shri Ravi Sharma, Advocate & Ms. Shruti Khimta, AR Department by Sh. Rajesh Kumar Dhanista, Sr. DR Date of hearing 31.01.2025 Date of pronouncement 31.01.2025 S.A. No.57 /Del/2025 2 | P a g e the impugned orders, the Ld. Tax Authorities have merely relied on findings in earlier years. They have also taken note of the fact that as with regard to income received by the assessee as consideration for providing domain name registration, after decision of Hon’ble Delhi Court, the Department is approaching the Hon’ble Supreme Court by way of SLP. Ld. Counsel has also impressed on the fact that the Co-ordinate Bench in which one of us (Judicial Member) was in quorum had considered all the disputed issues vide ITA No.1558 to 1561/Del/2022 for Assessment Years 2016-17 to 2019-20 and ITA No.3027/Del/2023 for Assessment Year 2021-22 vide order dated 01/01/2025 and decided the issues in favour of the assessee. 3. The aforesaid factual aspects could not be disputed by Ld. DR, however, it was submitted that the issues have not attained finality before the Hon’ble Supreme Court. It was submitted by him that interest of Revenue be protected by giving direction for deposit of at least 20% of the disputed demand. 4. We have considered the rival submissions and are of considered view that when the issues involved are squarely covered by judicial decision in favour of the assessee, in assessee’s own case, for other assessment years then assessee has strong primafacie case followed by a balance of convenience in its favour and also likely to be suffer financial hardship. No case for a direction to deposit 20% of the disputed demand is made out. S.A. No.57 /Del/2025 3 | P a g e 5. The application in hand is allowed with the direction of stay of disputed demand for Assessment Year 2022-23 for a period of 180 days or disposal of appeal, whichever is earlier. 6. In the result, Stay Application is allowed. Order pronounced in the open court on 31st January, 2025. Sd/- Sd/- (NAVEEN CHANDRA) (ANUBHAV SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 31st January, 2025. PK/Sps Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(A) 5. DR Asst. Registrar, ITAT, New Delhi "