Mercury Interactive Sales vs The Commissioner Of
2021 Latest Caselaw 1987 Kant

                              1



     IN THE HIGH COURT OF KARNATAKA AT BENGALURU

         DATED THIS THE 26TH DAY OF MAY, 2021

                         PRESENT

         THE HON'BLE MR. JUSTICE ALOK ARADHE

                            AND

THE HON'BLE MR. JUSTICE HEMANT CHANDANGOUDAR

                   I.T.A. NO. 401 OF 2012


BETWEEN:

MERCURY INTERACTIVE SALES
& SERVICES INDIA PVT. LTD.,
24, SALARPURIA ARENA
HOSUR MAIN ROAD, ADUGODI
BANGALORE-560 030
REPRESENTED BY ITS DIRECTOR
MR. V. CHANDRASEKHAR                         ... APPELLANT

(BY SRI. T. SURYANARAYANA, ADVOCATE.)

AND:

1.    THE COMMISSIONER OF
      INCOME- TAX
      C.R. BUILDING
      QUEENS ROAD
      BANGALORE-560 001

2.    THE DEPUTY DIRECTOR OF
      INCOME -TAX (INTERNATIONAL
      TAXATION) WARD 1 (1)
      BANGALORE-560 001
                                            ... RESPONDENTS
(BY SRI. K.V. ARAVIND, ADVOCATE.)
                            ---
                               2



      THIS I.T.A. IS FILED UNDER SEC. 260-A OF INCOME TAX
ACT 1961, ARISING OUT OF ORDER DATED 18.06.2012 PASSED
IN ITA NO.542/BANG/2011 FOR THE ASSESSMENT YEAR 2008-09,
PRAYING TO:

     (i) FORMULATE THE SUBSTANTIAL QUESTION OF LAW AS
STATED THEREIN.

     (ii) TO ALLOW THE APPEAL AND SET ASIDE THE ORDER OF
THE ITAT DATED 18/06/2012 IN ITA No.542/BANG/2011
(ANNEXURE-C), IN THE INTEREST OF JUSTICE AND EQUITY

     THIS I.T.A. COMING ON FOR HEARING,           THIS   DAY,
ALOK ARADHE J., DELIVERED THE FOLLOWING:

                         JUDGMENT

This appeal under Section 260A of the Income Tax

Act, 1961 (hereinafter referred to as the Act for short)

has been preferred by the assessee against the order

dated 18.6.2012 passed by the Income Tax Appellate

Tribunal, Bangalore. The subject matter of the appeal

pertains to the Assessment year 2008-2009. The appeal

was admitted by a bench of this Court vide order dated

15.12.2014 on the following substantial questions of

law:

"i) Whether the Tribunal was right in placing reliance on its earlier decision in the case of Samsung Electronics Co. Ltd. in ITA No.299/Bang/2011 dated 22.03.2012 where

it followed the judgment of this Hon'ble Court also in the case of Samsung Electronics Co. Ltd. in ITA No.2808/2005 dated 15.10.2011 though the said judgment of this Hon'ble Court had not been accepted and the SLP filed against it is pending before the Hon'ble Supreme Court?

ii) Whether on the facts, in the circumstances and on the grounds urged, the Tribunal was right in confirming the order passed by the CIT(A) by holding that the payments made by the Appellant was `royalty' as defined under Explanation 2 to Section 9(1)(vi) of the Income-tax Act, 1961, and under Article 13 of the India-UK, DTAA giving rise to an income chargeable to tax in India and necessitating deduction of tax under Section 195 of the Act?"

2. When the matter was takenup today, the

learned counsel for the assessee submitted that

aforesaid substantial questions of law have already been

answered in favour of the assessee by the Supreme

Court vide judgment dated 2.3.2021 in Civil Appeal

Nos.8733-8734/2018 viz, ENGINEERING ANALYSIS

CENTRE OF EXCELLENCE PRIVATE LIMITED -VS-

THE COMMISSIONER OF INCOME TAX.

3. The aforesaid submission has not been

disputed by the learned counsel for the Revenue.

4. In view of the decision of the Supreme Court

in case of ENGINEERING ANALYSIS CENTRE OF

EXCELLENCE PRIVATE LIMITED (supra) the

substantial questions framed in this appeal are

answered in favour of the assessee and against the

revenue. The order dated 18.6.2012 passed by the

Income Tax Appellate Tribunal is quashed.

In the result, appeal is allowed.

Sd/-

JUDGE

Sd/-

JUDGE

BKM