VERIZON COMMUNICATIONS SINGAPORE PTE LTD., SINGAPORE V. DCIT, INTNL TAXATION-1(2), CHENNAI

ITTPA 1/CHNY/2021

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3673 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 5 month(s) 6 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 03-07-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2017-2018
• Appeal Filed On: 27-01-2021
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: ALOK KUMAR SINHA LD

Judgement Text

आयकर अपीलीय अिधकरण ’डी’ ायपीठ चे ई म । IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, CHENNAI माननीय -ी महावीर िसंह, उपा34 एवं माननीय -ी मनोज कु मार अ9वाल ,लेखा सद< के सम4। BEFORE HON’BLE SHRI MAHAVIR SINGH, VICE PRESIDENT AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकर अपील सं./ IT(TP)A No.1/Chny/2021 (िनधाDरण वषD / Assessment Year: 2017-18) Verizon Communications Singapore Pte Ltd 10, Collyer Quay, #16-01 Ocean Financial Centre, Singapore – 049 315. C/o KRM Towers, 1 st & 2 nd Floor, No.1 Harrington Road, Chetpet, Chennai-600031 बनाम/ V s. DCIT International Taxation -1(2), Chennai. थायी लेखा सं./जीआइ आर सं./P AN /GI R No . AAD C M -6 3 5 5 - L (अपीलाथ /Appellant) : ( थ / Respondent) अपीलाथ की ओरसे/ Appellant by : Shri. Alok Kumar Sinha (CA) – Ld. AR थ की ओरसे/Respondent by : Dr. S. Palani Kumar (CIT) –Ld. DR सुनवाई की तारीख/ Date of Hearing : 04-07-2022 घोषणा की तारीख / Date of Pronouncement : 04-07-2022 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2017-18 arises out of the final assessment order dated 27.11.2020 passed by Ld. DCIT, International Taxation -1(2), Chennai pursuant to the directions of Ld. DRP u/s. 144C(5) of the Act dated 27.10.2020. IT(TP)A No.1/Chny/2021 - 2 - 2. At the time of hearing, Ld. AR relied on the decision of Hon’ble Supreme Court in the case of Engineering Analysis Centre of Excellence Pvt. Ltd. Vs. CIT [2021] SCC Online SC 159 (SC) and submitted that the receipts of the assessee could not be termed as royalty. However, Dr. S. Palani Kumar, Ld. CIT-DR, submitted that the issue stood covered against the assessee in assessee’s own case by the decision of Hon’ble High Court of Madras in TCA Nos.147 to 149 of 2011 dated 07.11.2013, the copy of which has been placed on record. In the above background, our adjudication would be as under. 3. The assessee being non-resident company is stated to be engaged in providing international connectivity services (bandwidth services or telecom services) in the Asia Pacific region including customers in India for transmission of data and voice. The assessee provides a private link that can transport voice data and video traffic between the offices in different countries. Thus, the assessee provides end to end managed dedicated bandwidth service that provides internet service to customers for various applications. The international leg of the telecom services provided outside India is provided by the assessee. The services of the assessee are referred to as International Private Leased Circuit (IPLC). The payment so received by the assessee for IPLC services was held to be taxable as royalty for use of or right to use of commercial and scientific equipment u/s. 9(1)(vi) r/w. explanation 2 of the Income Tax Act and Article 12(3) of the Double Taxation Avoidance Agreement (hereinafter referred to as ‘DTAA’) between India and Singapore. Accordingly, the amount of Rs.514.85 Lacs as received by the assessee from Indian customers for providing IPLC services was brought to tax @10%. IT(TP)A No.1/Chny/2021 - 3 - 4. The Ld. DRP, relying upon the aforesaid decision of Hon’ble High Court of Madras in assessee’s own case, decided this issue against the assessee. Aggrieved, the assessee is in further appeal before us. 5. It is undisputed fact that issue of taxability of IPLC services stood covered against the assessee by the aforesaid decision of Hon’ble High Court of Madras in assessee’s own case. Therefore, we see no reason to differ with the same, facts being pari-materia the same. 6. The appeal stand dismissed. Order pronounced on 04 th July, 2022. Sd/- (MAHAVIR SINGH) उपा34 /VICE PRESIDENT Sd/- (MANOJ KUMAR AGGARWAL) लेखा सद< / ACCOUNTANT MEMBER चे*ई / Chennai; िदनांक / Dated : 04-07-2022 JPV JPVJPV JPV आदेश की Xितिलिप अ 9ेिषत/Copy of the Order forwarded to : 1. अपीलाथ /Appellant 2. यथ /Respondent 3. आयकर आयु (अपील)/CIT(A) 4. आयकर आयु /CIT 5. िवभागीय ितिनिध/DR 6. गाड फाईल/GF