Appeal details
Counselvise Citation
[2022] 105 COUNSELVISE.COM (IT) 8777 (ITAT-DELHI)
Assessee PAN
Bench
Appeal Number
Duration Of Justice
9 year(s) 1 month(s) 18 day(s)
Appellant
Respondent
Appeal Type
Income Tax Appeal
Pronouncement Date
15-02-2022
Appeal Filed By
Assessee
Order Result
Allowed
Bench Allotted
D
Assessment Year
2009-2010
Appeal Filed On
27-12-2012
Judgement Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘D’, NEW DELHI BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND MS. ASTHA CHANDRA, JUDICIAL MEMBER (THROUGH VIDEO CONFERENCING) ITA No.1683/BANG/2012 Assessment Year: 2009-10 BEA Systems Inc. ( Since merged with Oracle Systems Corporation), 7 th Floor, Commerce @ Mantri Bannerghatta Road, South Taluk, Bangalore-76 Vs ADIT (International Taxation) Range-I, Banglore (APPELLANT) (RESPONDENT) Appellant by Sh. Tarandeep Singh, Advocate Sh. Pulkit Verma, Advocate Respondent by Sh. N. C. Swain, CIT DR Date of hearing: 16/02/2022 Date of Pronouncement: 16/02/2022 ORDER PER N. K. BILLAIYA, AM: This appeal filed by the assessee is preferred against the order dated 26.10.2012 framed u/s. 143 (3) r.w.s. 144 C(13) of the Act. 2. The grievance of the assessee read as under :- 2 3. Briefly stated the facts of the case are that the appellant is a software company engaged in the business of research, creation of software products and selling its products through its subsidiaries across the globe. The products were in the category 3 of middleware products used to provide the infrastructure base for applications to elicit information from various database. 4. In terms of the agreement, BEA systems India, ordered and distributed the software products strictly against an end user order in whose name the licenses were issued by appellant. Hence, the recipient of right to use is the end customer and not BEA Systems India. It may be pertinent to note that the software procured is merely a product in the hands of BEA Systems India as it has no right to use the product being a distributor. 5. BEA India was the one making payments to BEA Systems and not the end user. 6. The AO was of the firm belief that the payment received by the assessee is for right in a copy right and accordingly treated the same as royalty under Article 12 of DTAA. 7. Objections were raised before the DRP. The DRP after considering the objections came to the conclusion that the Tribunal in the case of the assessee for A.Y. 2007-08 held that the payments constitute royalty and confirmed the view of the AO. The DRP further observed that for the year under consideration there was no change in the issues involved and followed the decision of the DRP in A.Y.2007-08 and confirmed the view of the AO. In A.Y.2008-09 the quarrel travelled upto the 4 Hon’ble High Court of Karnataka and the Hon’ble High Court in ITA No.421/2012 C/W ITA No.269/2012 decided the quarrel in favour of the revenue. The relevant findings of the judgment of the Hon’ble Karnataka High Court (supra) read as under :- 8. The quarrel relating to the impugned issue as now been well settled by the judgment of the Hon’ble Supreme court in the case of Engineering Analysis Centre of Excellence Private Limited 432 ITR 471 wherein the Hon’ble Supreme Court has also considered 5 the Judgment of Hon’ble Karnataka High Court. The relevant finding of the Hon’ble Supreme Court read as under :- 9. Respectfully following the decision of the Hon’ble Supreme Court (supra) we direct the AO to delete the impugned addition the appeal filed by the assessee is accordingly allowed. 10. The order is pronounced in the open court on 16.02.2022 in the presence of both the rival representatives. Sd/- Sd/- (ASTHA CHANDRA) (N. K. BILLAIYA) JUDICIAL MEMBER ACCOUNTANT MEMBER *NEHA* Date:-16.02.2022 Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI 6 Date of dictation 16.02.2022 Date on which the typed draft is placed before the dictating Member Date on which the typed draft is placed before the Other member Date on which the approved draft comes to the Sr.PS/PS Date on which the fair order is placed before the Dictating Member for Pronouncement Date on which the fair order comes back to the Sr. PS/ PS Date on which the final order is uploaded on the website of ITAT 18.02.2022 Date on which the file goes to the Bench Clerk Date on which file goes to the Head Clerk. The date on which file goes to the Assistant Registrar for signature on the order Date of dispatch of the Order
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