International Management Group (UK) Ltd., London V. ACIT, International Taxation--2(1)(1), New Delhi

ITA 2245/DEL/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 4475 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-02-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 02-04-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Double taxation relief; Permanent establishment
• Section: 144C; 13

Judgement Text

PAGE | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH FRIDAY C : NEW DELHI BEFORE SHRI H.S.SIDHU , JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO. 2245/DEL/2018 (ASSESSMENT YEAR: 2015 - 16 ) INTERNATIONAL MANAGEMENT GROUP (UK) LTD, BUILDING NO. 6, CHISWICK PARK, 566, CHISWICK HIGH ROAD, LONDON W45HR, LONDON PAN: AABCI9309N VS. ACIT, INTERNATIONAL TAXATION - 2(1)(1), NEW DELHI (APPELLANT) (RESPONDENT) REVENUE BY : MR. RISHABH MALHOTRA, AR ASSESSEE BY: SHRI AMIT KATOCH, SR. DR DATE OF HEARING 15/02/2019 DATE OF PRONOUNCEMENT 1 8 /02/2019 O R D E R PER PRASHANT MAHARISHI , A. M. 1 . IN ITA NUMBER 2245/DEL/2018 FILED FOR ASSESSMENT YEAR 2015 16 THE ASSESSEE HAS REQUESTED FOR EARLY HEARING IN APPEAL FILED ON 02/04/2018. THE ASSESSEE SUBMITS THAT THE ISSUE INVOLVED IN THE PRESENT APPEAL IS WHETHER THE RECEIPT NOT ATTRIBUTABLE TO PERMANENT ESTABLISHMENT OF THE APPELLANT CAN BE TAXED AS FEES FOR TECHNICAL SERVICES UNDER ARTICLE 13 OF THE INDIA UNITED KINGDOM TAX TREATY WHICH IS SQUARELY COVERED WITH THE ORDER OF THE COORDINATE BENCH IN ASSESSEES OWN CASE DATED 04/10/2016 FOR ASSESSMENT YEAR 2010 11 AND 2011 12 TO 2014 15 , HENCE, EARLY HEARING MAY BE GRANTED TO THE ASSE SSEE. 2 . THE LEARNED AUTHORISED REPRESENTATIVE REITERATED THE SAME FACTS AS STATED IN THE APPLICATION DATED 10/01/2019. THE LEARNED DEPARTMENTAL REPRESENTATIVE ALSO DID NOT EXPRESS ANY CONCERN ABOUT GRANTING EARLY HEARING TO THE ASSESSEE IN THE IMPUGNED APPEA L. 3 . ON CAREFUL CONSIDERATION OF THE APPLICATION OF THE ASSESSEE IT IS APPARENT THAT THE ASSESSEE WANTS THAT AS THE ISSUE INVOLVED IN THIS APPEAL IS PAGE | 2 SQUARELY COVERED, SO, IT MAY BE DECIDED ON THE BASIS OF THE ORDER OF THE COORDINATE BENCH IN ASSESSEES OWN CASE FOR THE EARLIER YEAR. IN VIEW OF THIS WE GRANT EARLY HEARING OF THE IMPUGNED APPEAL. ACCORDINGLY THE APPLICATION OF THE ASSESSEE IS ALLOWED. 4 . FURTHER BOTH THE PARTIES SUBMITTED THAT THE ISSUE IS SQUARELY COVERED AGAINST THE ASSESSEE IN ASSESSEES O WN CASE BY THE DECISION OF THE COORDINATE BENCH FOR EARLIER YEARS AND THEREFORE THE SAME IS REQUIRED TO BE FOLLOWED IN THE PRESENT APPEAL ALSO. THEREFORE BOTH OF THEM SUBMITTED THAT THE MATTER MAY BE DECIDED ACCORDING TO THE DECISION OF THE COORDINATE BEN CH IN ASSESSEES OWN CASE FOR EARLIER YEARS. THEREFORE WITH THE CONSENT OF THE BOTH THE PARTIES THE MATTER WAS HEARD. 5 . BRIEF FACTS OF THE CASE SHOWS THAT THE ASSESSEE HAS FILED ITS RETURN OF INCOME DECLARING INCOME OF INR 48491843/ ON 30/11/2015 AS NON - RESIDENT FOREIGN COMPANY. THE FACT SHOWS THAT ASSESSEE IS A COMPANY INCORPORATED UNDER THE LAWS OF UNITED KINGDOM AND IS RESIDENT OF UNITED KINGDOM WITHIN THE MEANING OF ARTICLE 4 OF THE AGREEMENT FOR AVOIDANCE OF DOUBLE TAXATION AND PREVENTION OF FIS CAL EVASION BETWEEN INDIA AND UNITED KINGDOM. THE ASSESSEE AND BOARD OF CONTROL FOR CRICKET IN INDIA ENTERED INTO AN ARRANGEMENT, CONTRACT FOR ESTABLISHMENT, COMMERCIALIZATION AND OPERATION OF THE INDIAN PREMIER LEAGUE IN SEPTEMBER 2007. THE ASSESSEE ENTERED INTO AN INITIAL CONTRACT AND SUBSEQUENT SEPARATE SERVICE AGREEMENT FOR THE SERVICES TO BE PROVIDED TO THE BOARD OF CONTROL FOR CRICKET IN INDIA IN RELATION TO IPL. FOR THE PURPOSE OF PROVISION OF THE SERVICES IT DEPUTED SOME OF ITS E MPLOYEES FOR UNDERTAKING THE ON GROUND IMPLEMENTATION AND ELATED SUPERVISION ACTIVITIES IN INDIA. THE STAY OF THESE EMPLOYEES HAS EXCEEDED THE THRESHOLD LIMIT OF 90 DAYS IN INDIA AND HENCE THE ASSESSEE WAS HAVING A PERMANENT ESTABLISHMENT UNDER ARTICLE 5 OF THE DTAA. THE ASSESSEE ATTRIBUTED 63% OF THE TOTAL RECEIPTS FROM THE BOARD OF CONTROL FOR CRICKET IN INDIA AS ATTRIBUTABLE TO SUCH PE AND BALANCE RECEIPT OF 37% WAS HELD TO BE NOT TAXABLE IN INDIA. THIS WAS THE STAND TAKEN BY THE ASSESSEE. ACCORDING TO THAT THE RECEIPT OF RS 99912355/ WERE NOT TAXABLE IN INDIA. LEARNED ASSESSING OFFICER HELD THAT THE ABOVE SUM IS TAXABLE AS FEES FOR PAGE | 3 TECHNICAL SERVICES. ACCORDINGLY THE ASSESSMENT ORDER U/S 143 (3) READ WITH SECTION 144C (13) WAS PASSED ON 13/2/2018. AGAINST THIS ORDER THE ASSESSEE IS IN APPEAL BEFORE US. 6 . BOTH THE PARTIES SUBMITTED BEFORE US THAT THE ABOVE ISSUE IS SQUARELY COVERED AGAINST THE ASSESSEE BY THE DECISION OF THE COORDINATE BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2010 11 DATE D 4/10/2016 AS WELL AS FOR ASSESSMENT YEAR 2011 12 TO 2014 15 DATED 8/5/2018. 7 . WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND FIND THAT THE ABOVE ISSUE IS SQUARELY COVERED AGAINST THE ASSESSEE BY THE DECISION OF THE COORDINATE BENCH FOR EARLI ER YEARS IN ASSESSEES OWN CASE. THEREFORE, RESPECTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH IN ASSESSEES OWN CASE WE DISMISS THE APPEAL FILED BY THE ASSESSEE. 8 . ACCORDINGLY THE APPEAL NUMBER 2245/DEL/2018 FOR ASSESSMENT YEAR 2015 16 IS DISMIS SED. ORDER PRONOUNCED IN THE OPEN COURT ON 1 8 / 02 / 2019 . - SD/ - - SD/ - ( H.S.SIDHU ) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 8 / 02 / 2019 COPY FORWARDED TO 1 . APPLICANT 2 . RESPONDENT 3 . CIT 4 . CIT (A) 5 . DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI