ITO (IT) TDS-2, MUMBAI V. SKILL INFRASTRUCTURE LTD, MUMBAI

ITA 865/MUM/2011

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 93355 (ITAT-MUMBAI)
• Duration Of Justice: 4 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: L
• Next Hearing Date: 04-03-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 31-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: JITENDRA B SANGHAVI
• Keywords: Double taxation relief; Advance ruling
• Section: 201(1)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL L BENCH, MUMBAI , , BEFORE MS. SUSHMA CH O WLA , JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO S . 865 TO 867/MUM/2011 ( / ASSESSMENT YEAR S : 2004 - 05 TO 2006 - 07 THE ITO(IT), TDS - 2 113, SCINDIA HOUSE, BALLARD PIER, MUMBAI - 400 038 / VS. M / S. S K ILL INFRASTRUCTURE LTD., SKILL HOUSE, 209, BANK STREET X LANE, FORT, MUMBAI - 400 001 ./ ./ PAN/GIR NO. : AABCS 7689F ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI PANKAJ KUMAR / RESPONDENT BY : SHRI JITENDRA B. SANGHAVI / DATE OF HEARING : 2 1 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 29 .0 7 .2015 / O R D E R PER BENCH : TH ESE THREE APPEAL S BY THE REVENUE ARE PREFERRED AGAINST THE VERY SAME ORDER OF THE LD. CIT(A) - II , MUMBAI DT. 24.11.2010 PERTAINING TO ASSESSMENT YEAR S 200 4 - 0 5 TO 2006 - 07 . AS THE FIRST APPELLATE AUTHORITY HAS DECIDED THE APPEALS OF THREE ASSESSMENT YEARS BY A CONSOLIDATED ORDER, THE GRIEVANCE OF THE REVENUE IS SAME IN ALL THESE YEARS, THEREFORE, THESE WERE HEARD TOGETHER AND DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ITA. NO S . 865 TO 867/M/2011 2 2. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT WHILE MAKING THE ORDER U/S. 201(1)/201 (1A) OF THE ACT, THE ASSESSING OFFICER CAME TO KNOW THAT THE ASSESSEE HAS REMITTED RS. 99,67,023/ - TO M/S. APPELDORE INTERNATIONAL TOWARDS CONSULTANCY CHARGES DURING FINANCIAL YEAR 2004 - 05 WITHOUT DEDUCTING TAX AT SOURCE. THE AO ISSUED SHOW CAUSE NOTICE T O THE ASSESSEE ASKING IT TO EXPLAIN AS TO WHY NO TAX HAS BEEN DEDUCTED AT SOURCE ON SUCH REMITTANCE AND TO EXPLAIN WHY THE ASSESSEE SHOULD NOT BE TREATED AS ASSESSEE IN DEFAULT FOR NON DEDUCTION OF TAX AT SOURCE U/S. 201(1) AND 201(1A) OF THE I.T. ACT. 2 .1. THE ASSESSEE FILED A DETAILED EXPLANATION EXPLAINING THAT IT ENTERED INTO AN AGREEMENT WITH M/S. APPLEDORE INTERNATIONAL LTD OF ENGLAND ON 25.4.2003 WHICH WAS MODIFIED BY ADDITIONAL CORRIGENDUM MADE ON 2.5.2003. IT WAS EXPLAINED THAT M/S. APPLEDORE IN TERNATIONAL LTD., WAS TO EVALUATE THE BUSINESS OPPORTUNITIES FOR PIPAVAV SHIP DISMANTLING AT PIPAVAV, GUJARAT, INDIA. AS PER THE AGREEMENT, THE TOTAL VALUE OF THE CONTRACT WAS GBP 1,59,200 EXCLUDING REIMBURSEMENT OF ACTUAL TRAVELLING EXPENSES. THE DETAIL S OF YEAR - WISE REMITTANCE MADE AND TAX DEDUCTED AT SOURCE WERE SHOWN AS UNDER: YEAR WISE BREAK - UP OF REMITTANCE MADE TO APPLEDORE INTERNATIONAL F.Y. 2003 - 04 S.NO. DATE OF REMITTANCE AMT IN GBP TDS (GBP) NET REMITTANCE AMT IN INR 1 14//5/2003 31,840 4776 27064 2446458 2 21/08/2003 31,840 0 31840 234048 3 01/09/2003 3,014.79 0 3014.79 222483 4 11/12/2003 2,665.68 0 2665.68 213308 5 15/12/2003 13,823 2073 11750 1107927 6. 21/01/2004 25,977 0 25977 2159988 FY 2004 - 05 1 08/5/2004 2,566.67 0 2566.67 207361 2 28/10/2004 15,000 0 15000 1266450 FY 2005 - 06 1 07/06/2005 16,133 16133 1291608 2 09/09/2005 24.587 3688 20899 1979124 ITA. NO S . 865 TO 867/M/2011 3 PAID IN 2 INSTAL. 09/09/2005 10449 03/10/2005 10449 TOTAL 1,67,447 10537 177808 13237754 2.2. AFTER PERUSING THE DETAILS, THE AO NOTICED THAT IN RESPECT OF CERTAIN SERVICES, THE ASSESSEE HAS DEDUCTED TAX AT SOURCE, WHILE IN RESPECT OF SOME OTHER SERVICES, THE ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE. THE ASSESS EE WAS ASKED TO EXPLAIN ITS STAND. 2.3. THE ASSESSEE EXPLAINED THAT ARTICLE 13 IS NOT APPLICABLE AS THE SERVICES RENDERED BY APPLEDORE AS SPECIFIED IN THE CORRIGENDUM TO THE AGREEMENT ARE CONSULTANCY SERVICES AND DO NOT MAKE AVAILABLE THE TECHNICAL KNOW LEDGE, SKILL ETC. IT WAS FURTHER EXPLAINED THAT FTS AS DEFINED IN ARTICLE 13(4) DO NOT APPLY TO THE FACTS OF THE CASE. IT WAS BROUGHT TO THE NOTICE OF THE AO THAT THE PAYMENT TO M/S. APPLEDORE INTERNATIONAL LTD AGGREGATING TO GBP 88950 DOES NOT CONSTITUT E FTS AND THE SAME IS THEREFORE BUSINESS PROFITS UNDER THE DTAA. AS M/S. APPLEDORE DOES NOT HAVE PE IN INDIA UNDER ARTICLE - 7 OF THE INDIA - UK TREATY, THEREFORE THE SAID PAYMENT IS NOT LIABLE TO TAX IN INDIA, THEREFORE, NO WITHHOLDING TAX WAS DEDUCTED AND T HERE IS NO DEFAULT IN RESPECT OF WITHHOLDING TAX. 2.4. THE SUBMISSIONS MADE BY THE ASSESSEE DID NOT FIND ANY FAVOUR WITH THE AO WHO WAS OF THE FIRM BELIEF THAT THE PAYMENT FOR THE SERVICES PROVIDED AS PER ADDITIONAL CORRIGENDUM ALSO FAL L UNDER THE CATEGO RY FEES FOR TECHNICAL SERVICES AND SINCE THE BENEFICIARY IS SUPPOSED TO CARRY OUT GLOBAL MARKET SURVEY TO DETERMINE DEMAND FOR REPAIRS CONVERSION NEW BUILDS AND TO DETERMINE THE SHORT/MEDIUM/LONG TERM BUSINESS PROSPECTS AT PIPAVAV , A CCORDING TO THE AO, T HE SERVICES PROVIDED BY CONSULTANT APPLEDORE MAKES AVAILABLE TECHNICAL KNOWLEDGE/PLAN OR DESIGN TO THE ITA. NO S . 865 TO 867/M/2011 4 ASSESSEE AS REQUIRED UNDER ARTICLE 13(4)(C) OF THE DTAA. THE AO FINALLY CONCLUDED BY HOLDING THAT THE EXPLANATION OF THE ASSESSEE IS REJECTED AND REMITT ANCE OF GBP OF 88950 IS TREATED AS FEES FOR TECHNICAL/CONSULTANCY ONLY. THE AO COMPUTED THE TAX U/S. 201(1) OF THE ACT AND ALSO INTEREST U/S. 201(1A) OF THE ACT FOR ALL THE ASSESSMENT YEARS UNDER CONSIDERATION. 3. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) AND ONCE AGAIN EXPLAINED THE NATURE OF TRANSACTION QUA THE AGREEMENT DATED 25 TH APRIL, 2003 AND THE ADDITIONAL CORRIGENDUM DATED 2.5.2003. IT WAS EXPLAINED THAT M/S. APPLEDORE INTERNATIONAL WAS APPOINTED TO UNDERTAKE A STUDY ON EVALUATION O F BUSINESS OPPORTUNITIES OF PIPAVAV SHIP DISMANTLING FACILITY, PIPAVAV, GUJARAT, INDIA. THE SCOPE OF THE WORK HAS BEEN GIVEN IN THE APPENDIX B OF THE SAID AGREEMENT. IT WAS FURTHER EXPLAINED THAT THE ASSESSEE ENTERED INTO AN ADDITIONAL CORRIGENDUM AGREEME NT WITH M/S. APPLEDORE INTERNATIONAL AS ON 2.5.2003 WHEREIN THE VALUE OF THE DIFFERENT SERVICES HAS BEEN SPECIFIED. IT WAS EXPLAINED THAT ON A SUM OF 70,250 GBP, THE ASSESSEE HAS DEDUCTED TAX AT SOURCE AND IN RESPECT OF PAYMENT OF GBP 88,950, THE ASSESSEE HAS NOT DEDUCTED TAX AT SOURCE. THE ATTENTION OF THE FIRST APPELLATE AUTHORITY WAS DRAWN TO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CONTINENTAL CONSTRUCTION CO. LTD. 219 ITR 81 WHEREIN THE HONBLE SUPREME COURT HAS HELD THAT THERE MAY BE A CASE WHERE UNDER A SINGLE CONTRACT WITH SINGLE INDIVISIBLE CONSIDERATION WITH SEPARATELY IDENTIFIED SETS OF ACTIVITY, IT IS POSSIBLE TO APPORTION THE SINGLE CONSIDERATION BETWEEN DIFFERENT SETS OF ACTIVITIES. IT WAS FURTHER CONTENDED THAT THE PAYMENT OF GBP 88,950 DOES NOT FALL WITHIN THE MEANING OF FEES FOR TECHNICAL SERVICES AS DEFINED IN ARTICLE 13(4) OF THE TREATY. ITA. NO S . 865 TO 867/M/2011 5 3.1. AFTER CONSIDERING THE FACTS AND THE SUBMISSIONS IN THE LIGHT OF THE DTAA BETWEEN INDIA AND UK AND DRAWING SUPPORT FROM THE RULING OF THE AUTHORITY FOR ADVANCE RULINGS IN THE CASE OF INTERTEK TESTING SERVICES INDIA PVT. LTD. 307 ITR 418, THE LD. CIT(A) WA S CONVINCED THAT IN RESPECT OF SERVICES WHICH ARE COMMERCIAL IN NATURE AND DO NOT FALL UNDER THE FTS, THEREFORE, THERE WAS NO NEED TO DEDUCT WITHHOLDING TAX ON THE PAYMENT OF GBP 88950 AND ALLOWED THE APPEALS OF THE ASSESSEE. 4. AGGRIEVED BY THIS, THE RE VENUE IS BEFORE US. 5. THE LD. DEPARTMENTAL REPRESENTATIVE STRONGLY SUPPORTED THE FINDINGS OF THE AO. IT IS THE SAY OF THE LD. DR THAT THE BIFURCATION OF THE SERVICES MADE BY THE ASSESSEE IN THE AGREEMENT AND THE ADDITIONAL CORRIGENDUM AGREEMENT IS ARBI TRARY AND WITHOUT ANY BASIS. THE LD. DR CONTINUED TO SUBMIT THAT THE SERVICES RENDERED BY APPLEDOR COMES WITHIN THE DEFINITION OF FEES FOR TECHNICAL SERVICES AND THEREFORE THE ASSESSEE SHOULD HAVE DEDUCTED TAX AT SOURCES AND THE AO HAS RIGHTLY TREATED THE ASSESSEE AS ASSESSEE IN DEFAULT. 6. PER CONTRA, THE LD. COUNSEL FOR THE ASSESSEE ADVANCED THE VERY SAME ARGUMENTS WHICH WERE ADVANCED BEFORE THE FIRST APPELLATE AUTHORITY. THE LD. COUNSEL FURTHER RELIED UPON THE SAME DECISIONS WHICH WERE RELIED UPON BE FORE THE FIRST APPELLATE AUTHORITY. 7. HAVING HEARD THE RIVAL SUBMISSIONS, WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE ORDERS OF THE AUTHORITIES BELOW. THE UNDISPUTED FACTS ARE THAT THE ASSESSEE ENTERED INTO AN AGREEMENT WITH M/S. APPLEDORE INTERNAT IONAL LTD., VIDE AGREEMENT DT. 25.4.2003 BY WHICH M/S. APPLEDORE INTERNATIONAL LTD., WAS MADE CONSULTANT TO PERFORM CERTAIN SERVICES VIZ., TO UNDERTAKE EVALUATION OF BUSINESS OPPORTUNITIES OF PIPAVAV SHIP ITA. NO S . 865 TO 867/M/2011 6 DISMANTLING FACILITY, PIPAVAV, GUJARAT, INDIA. THE SCOPES OF SERVICES ARE MENTIONED IN APPENDIX - B WHICH READ AS UNDER: 2.1. VISION: PIPAVAV SHIPYARD, IN DUE COURSE OF TIME, SHOULD BECOME ONE OF THE LEADING WORLD - CLASS SHIPYARDS CAPABLE OF DESIGNING, BUILDING, CONVERTING AND REPAIRING ALL TYPES OF VESS ELS UPTO 1000 K DWT AS PER CURRENT INTERNATIONAL STANDARDS OF DELIVERY SCHEDULE, PRODUCTIVITY, QUALITY AND USE OF MODERN TECHNOLOGY. THE RANGE OF SUCH VESSELS WOULD PRIMARILY COVER LARGE WARSHIPS & MERCHANT SHIPS, OFFSHORE STRUCTURES, FPSOS. OIL DRILLING RIGS. 2.2 SCOPE OF WORK 1. A GLOBAL MARKET SURVEY TO DETERMINE THE SHORT/MEDIUM/LONG TERM DEMAND FOR REPAIRS, CONVERSIONS AND NEW BUILDS OF DIFFERENT CATEGORIES OF VESSELS, OFFSHORE STRUCTURES AND DRILLING RIGS. FROM THE ABOVE SURVEY, TO DETERMINE THE SHORT/MEDIUM/LONG TERM BUSINESS PROSPECTS AT PIPAVAV. (SHORT TERM IS PROPOSED TO BE CONSIDERED AS UPTO 2007; MEDIUM TERM UPTO 2015 AND LONG - TERM UPTO 2025.) 2. PREPARATION OF A DETAILED PROJECT PLAN FOR THE PROPOSED SHIPYARD KEEPING '11 VIEW THE VISION STATEMENT AND INTER - ALIA INCLUDING THE FOLLOWING: - (A) DETAILED LAY - OUT PLAN. (B) SPECIFIC FACILITIES AND EQUIPMENT REQUIRED ALONG WITH ALL RELEVANT DETAILS (C) ACTION PLAN TO CREATE IN - HOUSE DESIGN CAPABILITIES (D) STRATEGY FOR MANNING AND FOR T RAINING OF PERSONNEL (E) THE NUMBER OF PHASES OF DEVELOPMENT REQUIRED AND THE TIME FRAMES/ACTIVITY CONTENT OF EACH PHASE. 3. EXAMINATION OF THE DOCKS, THEIR APPROACHES AND THE SITE CONDITIONS FOR SAFE SHIP HANDLING, DOCKING AND UNDOCKING AND RECOMMEND ITA. NO S . 865 TO 867/M/2011 7 A CTIONS TO BE TAKEN. IF ANY. ALSO RECOMMEND MEANS OF PROVIDING ALTERS IN BOTH THE DRY DOCKS. 4. ESTIMATION OF CASH FLOW FOR EACH PHASE OF THE MASTER PLAN INCLUDING CAPITAL REQUIREMENT, ESTABLISHMENT OF FINANCIAL STRUCTURE, IRR AND PAY - BACK PERIOD BASED ON BUSINESS OPPORTUNITIES AND GROWTH AS PREDICTED BY THE MARKET STUDIES AT SR. I ABOVE' 5. A COMPREHENSIVE REPORT TO BE SUBMITTED WITHIN 6 MONTHS OF AWARD OF THE CONSULTANCY COVERING ALL THE ABOVE ASPECTS DULY SUPPORTED BY NECESSARY DOCUMENTS, DRAWINGS & CALCULATIONS. REPORTS TARGETED FOR 31 ST OCTOBER 2003. 6. AN INITIAL REPORT WITHIN 2 MONTHS OF AWARD OF THE CONSULTANCY RECOMMENDING MINIMUM INFRASTRUCTURE REQUIRED FOR UNDERTAKING REPAIRS IN AFLOAT CONDITION OF VESSELS SUCH OSVS & MERCHANT SHIPS CALLIN G AT PIPAVAV PORT. REPORT TARGETED FOR 30 TH JUNE 2003. 7.1. IT WAS AGREED THAT THE ASSESSEE WILL PAY GBP 1,59,200 EXCLUDING TRAVEL AND OTHER EXPENSES. IMMEDIATELY AFTER ENTERING THIS AGREEMENT AN ADDITIONAL CORRIGENDUM WAS MADE ON 2.5.2003 BY WHICH TH E ASSESSEE AND M/S. APPLEDORE INTERNATIONAL LTD., AGREED FOR SPECIFYING THE VALUE OF DIFFERENT SERVICES WHICH READ AS UNDER: THIS ADDITIONAL CORRIGENDUM MADE ON 2ND DAY OF MAY 2003 BETWEEN APPLEDORE INTERNATIONAL LIMITED, A U.K REGISTERED COMPANY AND SEA KING INFRASTRUCTURE LIMITED: AN INDIAN COMPANY TO AMEND THE ORIGINAL DOCUMENT DATED 25 TH APRIL 2003. WHEREAS THE PARTIES HERETO HAD ENTERED INTO CONTRACT WHEREBY APPLEDORE INTERNATIONAL LTD. HAD AGREED TO CONDUCT THE STUDY ON EVALUATION OF BUSINESS OPPO RTUNITIES OF PIPAVAV SHIP DISMANTLING ARID ENGINEERS FACILITY AT PIPAVAV, INDIA. WHEREAS THE SAID DOCUMENT PROVIDED THE SCOPE OF WORK AND THE CONTRACT VALUE. NOW APPLEDORE AND SEA KING ARE DESIROUS OF SPECIFYING THE VALUE OF DIFFERENT SERVICES AND THE SAME' S AGREED BETWEEN THEM AS UNDER: ITA. NO S . 865 TO 867/M/2011 8 1.THE CONTRACT VALUE IN GREAT BRITAIN POUNDS (GBP) 70,250 IN RESPECT OF FOLLOWING SERVICES: A. DETAILED LAYOUT PLAN. B . DETERMINE SPECIFIC FACILITIES AND EQUIPMENT REQUIRED. C. ACTION PLAN TO CREATE IN - HOUSE DESIGN SERVICES. D. EXAMINE THE DOCKS, THEIR APPROACHES AND SITE CONDITIONS FOR SAFE SHIP HANDLING, DOCKING AND UNDOCKING, WITH RECOMMENDATIONS. E. PROVIDE REPOR T ON THE ABOVE, WITH PHASED DEVELOPMENT PLAN. 2. THE CONTRACT VALUE IN GREAT BRITAIN POUNDS (GBP) ....88,950 IN RESPECT OF FOLLOWING SERVICES: A. A GLOBAL MARKET SURVEY TO DETERMINE DEMAND FOR REPAIRS CONVERSIONS AND NEW BUILDS. B. TO DETERMINE THE SHORT/MEDIUM/LONG TERM BUSINESS PROSPECTS AT PIPAVAV. C. TO DETERMINE A STRATEGY FOR MANNING AND TRAINING PERSONNEL. D. ESTIMATION OF CASH FLOWS, CAPITAL REQUIREMENTS, FINANCIAL STRUCTURE AND PAY - BACK PERIOD. E. PROVIDE REPORT ON THE ABOVE. 7.2 . ON THE FIRST SET OF SERVICES ON PAYMENT OF GBP 70250, THE ASSESSEE HAS DEDUCTED TAX AT SOURCE AND THAT IS NOT IN DISPUTE. THE POINT OF DISPUTE IS ON PAYMENT OF GB P 88,950. ON THE SECOND SET OF SERVICES ON WHICH THE ASSESSEE HAS NOT DEDUCTED TAX AT SOUR CE AND ACCORDING TO THE AO, THESE SERVICES ALSO FALL WITHIN THE DEFINITION OF FEES FOR TECHNICAL SERVICES. THUS, THE ENTIRE DISPUTE REVOLVES AROUND THE FACT THAT WHETHER THE SERVICES RENDERED BY M/S. APPLEDORE INTERNATIONAL LTD., COME WITHIN THE PURVIEW ITA. NO S . 865 TO 867/M/2011 9 O F ARTICLE 13(4)(C) OF THE DTAA BETWEEN INDIA AND UK AS TECHNICAL SERVICES. IT IS FURTHER CONTENDED THAT THE SERVICES CANNOT BE EVEN TAX ED UNDER ARTICLE - 7 READ WITH ARTICLE - 5 OF THE DTAA I N THE ABSENCE OF PE OF M/S. APPLEDORE INTERNATIONAL LTD. W E FIND TH AT THE AO HAS REJECTED THE C LAIM OF THE ASSESSEE AND HELD THAT THE SERVICES RENDERED BY M/S. APPLEDORE INTERNATIONAL LTD., ARE IN THE NATURE OF TECHNICAL SERVICES. 7.3. SERVICES CAN BE SAID TO MAKE AVAILABLE TECHNICAL KNOWLEDGE ETC, WHERE SUCH TECHNICAL KNOWLEDGE IS TRANSFERRED TO THE PERSON UTILIZING THE SERVICE THAT IS THE ASSESSEE IN THE PRESENT CASE AND SUCH PERSON IS ABLE TO MAKE USE OF THE TECHNICAL KNOWLEDGE ETC BY HIMSELF IN HIS BUSI NESS OR FOR HIS OWN BENEFITS AND WITHOUT RECOURSE TO THE PERFORMER OF SERVICE IN THE FUTURE. WE FIND THAT ON THE SECOND SET OF SERVICES M/S. APPLEDORE INTERNATIONAL LTD., HAS MERELY PROVIDED SERVICES FOR GLOBAL MARKET SURVEY TO DETERMINE DEMAND FOR REPAIR S, CONVERSIONS , NEW BUILDS AND TO DETERMINE THE SHORT/MEDIUM/LONG TERM BUSINESS PROSPECTS AT PIPAVAV. TO DETERMINE A STRATEGY FOR MANNING AND TRAINING PERSONNEL A N ESTIMATION OF CASH FLOWS AND CAPITAL REQUIREMENTS, FINANCIAL STRUCTURE AND PAY - BACK PERIOD AND PROVIDE REPORT FOR THE SAME. THESE SERVICES BY M/S. APPLEDORE INTERNATIONAL LTD., WERE NOT GIVEN TOWARDS IMPARTING ANY TECHNICAL KNOWLEDGE OR EXPERIENCE TO THE ASSESSEE THAT COULD BE USED BY THE ASSESSEE INDEPENDENTLY IN ITS BUSINESS AND WITHOUT REC OURSE TO M/S. APPLEDORE INTERNATIONAL LTD. THESE SERVICES WERE NEITHER GEARED TO NOR DID THEY MAKE AVAILABLE ANY TECHNICAL KNOWLEDGE, SKILL OR EXPERIENCE TO THE ASSESSEE OR CONSISTED OF DEVELOPMENT AND TRANSFER OF A TECHNICAL MAN OR TECHNICAL DESIGN TO THE ASSESSEE. FOR THIS PROPOSITION, WE DRAW SUPPORT FROM THE DECISION OF THE TRIBUNAL IN NOKIA INDIA PVT. LTD. 59 TAXMAN.COM 120 (DELHI) . ITA. NO S . 865 TO 867/M/2011 10 7.4. CONSIDERING THE AFOREMENTIONED SERVICES IN TOTALITY, IN OUR UNDERSTANDING M/S. APPLEDORE INTERNATIONAL LTD., IN THE SECOND SET OF SERVICES IS NOT RESPONSIBLE FOR PREPARATION OF ANY DESIGN, DIAGRAM ETC. FOR THE ASSESSEE AND ACCORDINGLY ON THE SECOND SET OF SERVICES PROVIDED BY M/S. APPLEDORE INTERNATIONAL LTD., DOES NOT INVOLVE DEVELOPMENT AND TRANSFER OF A TECHNICAL MAN OR TECHNICAL DESIGN TO THE ASSESSEE. ACCORDINGLY, WE HOLD THAT THE PAYMENTS MADE BY THE ASSESSEE TO M/S. APPLEDORE INTERNATIONAL LTD., O N THE SECOND SET OF SERVICES FOR WHICH PAYMENT HAS BEEN MADE GBP 88950 DO NOT QUALIFY AS FT S UNDER THE PROVISIONS OF INDO - UK TAX TREATY. 7.5. FURTHER, AS PER THE PROVISIONS OF INDO - UK TAX TREATY WHERE THE SERVICES DO NOT QUALIFY AS FT S , ARTICLE 13 WOULD NOT BE APPLICABLE TO M/S. APPLEDORE INTERNATIONAL LTD AND ITS TAXABILITY WOULD NEED TO BE EXAMINED AS PER ARTICLE - 7 READ WITH ARTICLE - 5 OF THE INDO - UK TAX TREATY. BUSINESS PROFITS EARNED BY M/S. APPLEDORE INTERNATIONAL LTD., IS TAXABLE IN INDIA ONLY IF T HAT ENTERPRISE CARRIES ON BUSINESS IN INDIA THROUGH PE IN INDIA. MOREOVER, THIS IS NOT THE ISSUE BEFORE US THEREFORE, WE DECLINE TO INTERFERE WITH THE FINDINGS OF THE LD. CIT(A). ALL THESE APPEALS BY THE REVENUE ARE ACCORDINGLY DISMISSED. 8. IN THE RES ULT, ALL THE APPEALS FILED BY THE REVENUE ARE DISMISSED. OR DER PRONOUNCED IN THE OPEN COURT ON 29 TH JU LY , 2015 SD/ - SD/ ( SUSHMA CH O WLA ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 29 TH JU LY , 2015 . . ./ RJ , SR. PS ITA. NO S . 865 TO 867/M/2011 11 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI