Income Tax Appellate Tribunal - Bangalore
Google Llc (Formerly Known As Google ... vs Deputy Commissioner Of Income Tax, ... on 9 September, 2022
IN THE INCOME TAX APPELLATE TRIBUNAL
"C" BENCH : BANGALORE
BEFORE SHRI N.V. VASUDEVAN, VICE PRESEIDENT
AND
SHRI PADMAVATHY S, ACCOUNTANT MEMBER
SP No.37/Bang/2022
[in IT(IT)A No.688/Bang/2022]
Assessment year : 2012-13
Google LLC, Vs. The Deputy Commissioner
1600, Amphitheatre Parkway, of Income Tax,
Mountain View, International Taxation,
CA US 94043. Circle 1(1),
PAN: AADCG 7673B Bengaluru.
APPELLANT RESPONDENT
Applicant by : Shri Deepak Chopra, Advocate
Respondent by : Dr. Shankar Prasad K., Addl.CIT(DR)(ITAT), Bengaluru.
Date of hearing : 09.09.2022
Date of Pronouncement : 09.09.2022
ORDER
Per Padmavathy S., Accountant Member
This is a stay petition filed by praying for an order of stay of recovery of outstanding demand of Rs.12,63,43,319 arising out of the final order of assessment of the AO passed u/s. 143(3) r.w.s. 144C of the Income-tax Act, 1961 [the Act].
2. The outstanding demand arises out of an addition made to the total income of the assessee of a sum of Rs.39,48,22,872. The assessee is a foreign company. It had seconded its employees to Google India SP No.37/Bang/2022 Page 2 of 3 Pvt. Ltd. [GIPL]. GIPL reimbursed the salary paid by the assessee to the seconded employees. The question before the AO was whether the said sum was taxable in the hands of the assessee as Fees for Technical Services [FTS]. The revenue authorities held that the payment in question was in the nature of FTS which was taxable in the hands of the assessee in India. The stand of the assessee was that the sums in question were mere reimbursement with no profit element and cannot be regarded as income or FTS chargeable to tax in India. The outstanding demand as stated in the stay petition was originally a sum of Rs.12,63,43,319. There were some apparent mistakes in the computation of total income by the AO and the assessee filed an application u/s. 154 of the Act. The AO by an order dated 16.8.2022 has rectified the mistakes in the final order of assessment, consequent to which the outstanding demand now stands reduced to Rs.7,26,08,563.
3. We have considered the rival submissions and perused the material on record. Having regard to the grounds raised by the assessee in the Grounds of Appeal which discloses existence of a prima facie case and considering the balance of convenience and relative hardship, we are of the view that it would be just and appropriate to grant an order of stay of recovery of outstanding demand, subject to the condition that the assessee pays 20% of the outstanding demand on or before 20th September, 2022 [20.09.2022]. There would be a stay of recovery of outstanding demand for a period of six months from the date of this order, or till the disposal of the SP No.37/Bang/2022 Page 3 of 3 appeal, whichever is earlier. The appeal is directed to be fixed for hearing out of turn for hearing on 21st September, 2022 [21.09.2022].
4. In the result, the stay petition is allowed on the above terms.
Pronounced in the open court on this 9th day of September, 2022.
Sd/- Sd/-
( N V VASUDEVAN ) ( PADMAVATHY S )
VICE PRESIDENT ACCOUNTANT MEMBER
Bangalore,
Dated, the 9th September, 2022.
/Desai S Murthy /
Copy to:
1. Appellant 2. Respondent 3. CIT 4. CIT(A)
5. DR, ITAT, Bangalore.
By order
Assistant Registrar
ITAT, Bangalore.