The Deputy Commissioner Of Income Tax vs M/S M.I. Limited
2024 Latest Caselaw 22156 Kant

Karnataka High Court

The Deputy Commissioner Of Income Tax vs M/S M.I. Limited on 2 September, 2024

Author: S.G.Pandit

Bench: S.G.Pandit

                                             -1-
                                                      NC: 2024:KHC:35625-DB
                                                        WA No. 598 of 2024




                   IN THE HIGH COURT OF KARNATAKA AT BENGALURU

                        DATED THIS THE 2ND DAY OF SEPTEMBER, 2024

                                          PRESENT
                           THE HON'BLE MR JUSTICE S.G.PANDIT
                                             AND
                          THE HON'BLE MR JUSTICE C.M. POONACHA
                           WRIT APPEAL NO. 598 OF 2024 (T-IT)
                   BETWEEN:

                        THE DEPUTY COMMISSIONER OF INCOME TAX
                        (INTERNATIONAL TAXATION)
                        CIRCLE-2(2) ROOM NO.430, 4TH FLOOR, BMTC
                        BUILDING, KORAMANGALA
                        BENGALURU - 560095.


                                                               ...APPELLANT
                   (BY SRI. SANMATHI E I.,ADVOCATE)

                   AND:
Digitally signed
by                 1.   M/S M.I. LIMITED
MARIGANGAIAH
PREMAKUMARI             10, INTERNATIONAL BUSINESS PARK,
Location: HIGH          SINGAPORE - 609928
COURT OF                REPRESENTED BY ITS AUTHORIZED SIGNATORY
KARNATAKA               LEE KOK CHEW SON OF LEE CHIN
                        LAM, AGED ABOUT 54 YEARS
                        10 INTERNATIONAL BUSINESS PARK
                        SINGAPORE - 609 928


                                                              RESPONDENT
                                 -2-
                                           NC: 2024:KHC:35625-DB
                                              WA No. 598 of 2024




     WRIT APPEAL FILED U/S 4 OF THE KARNATAKA HIGH
COURT ACT PRAYING TO i)SET ASIDE THE ORDER DATED
02/11/2023 IN WP NO.5452/2022 PASSED BY THE HONBLE
LEARNED SINGLE JUDGE.

    THIS APPEAL, COMING ON FOR ORDERS, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.G.PANDIT
       and
       HON'BLE MR JUSTICE C.M. POONACHA


                       ORAL JUDGMENT

(PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard Sri. E.I.Sanmathi, learned counsel for the

appellant.

2. Perused the appeal papers.

3. The question involved in the appeal is as to whether

interconnect service charges paid would amount to royalty.

4. The above issue was considered by a Co-ordinate

Bench of this court in ITA.No.160/2015 and connected appeals.

By judgment dated 14.07.2023 it is held that interconnect

service charges would not constitute royalty. Paragraph No.21

of the judgment reads as follows:

"The third question is, whether the payments made to NTOS for providing interconnect services and transfer of capacity in foreign countries is chargeable to

NC: 2024:KHC:35625-DB

tax as royalty. It was argued by Shri.Pardiwala, that for subsequent years in assessee's own case, the ITAT has held that tax is not deductable when payment is made to non-resident telecom operator. This factual aspect is not refuted. Thus the Revenue has reviewed its earlier stand for the subsequent assessment years placing reliance on Viacom etc35, rendered by the ITAT. In that view of the matter this question also needs to be answered against the Revenue."

5. Learned Single Judge has also placed reliance on

the above decision of the Co-ordinate Bench. Therefore, we do

not find any infirmity in the order under challenge.

6. Following the decision of Co-ordinate Bench dated

14.07.2023 in ITA No.160/2015 and connected appeals, the

above appeal stands dismissed.

Sd/-

(S.G.PANDIT) JUDGE

Sd/-

(C.M. POONACHA) JUDGE

MPK CT:bms