2014-VIL-01--DT
Equivalent Citation: [2014] 364 ITR 381 (AAR)
AUTHORITY FOR ADVANCE RULINGS
A.A.R. Nos. 1055 of 2011
Date: 02.05.2014
IN RE: STERIA (INDIA) LIMITED
Vs
For the Appellant : Mr. G.C. Srivastava, Advocate, Mr. Arun Chhabra, CA, Mr. Saurabh Srivastava, CA, Ms. Nidhi Gupta, CA, Ms. Shradha Mintri, CA
For the Respondent : Mr. Manoj Kumar Mahar,JCIT
BENCH
Dr. Arijit Pasayat and Mr. T.B.C. Rozara, JJ.
JUDGMENT
14. The services being accepted as technical services under the Act and the Tax Treaty, the payment for the services will be covered by ‘fees for technical services’ chargeable under the Act. The submission of the applicant that the services being managerial which was omitted in the definition of fees for technical services in the revised DTAA between India – UK entered into in the year 1993, the managerial services rendered by the applicant will also automatically be omitted in the definition of fees for technical services under the Tax Treaty between India-France by application of the Protocol, is also not acceptable for the reasons discussed above regarding application of the Protocol in the Treaty. The payment for services rendered by the applicant will therefore, falls under the definition of fees for technical services even under the Tax Treaty between India-France. In summary, the payments made by the applicant for the services rendered comes under the definition of fees for technical services both under the Act and the Treaty and is liable to tax in India.
15. The questions are, therefore, answered as under:-
(1) The payment made by Steria (India) Limited for the management services provided by Groupe Steria SCA will be taxable as Fees for Technical Services.
(2) As the consideration for the services is held to be taxable in India, the applicant will be liable to withhold tax as per the provision of Section 195 of the Income-tax Act, 1961 from the payments made/to be made to Steria France.
The ruling is given and pronounced accordingly on this 2nd day of May, 2014.
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