Acit, Central Circle- 6 , New Delhi vs Anil Aggarwal , Ghaziabad on 28 August, 2019
5. Regarding the issue in dispute, the issue is squarely covered by the
judgment in DCIT(IT) V. Infosys BPO Ltd. [2015] 60 taxmann.com 465
wherein it was held that where assessee made royalty payments to non-
residents, since benefit of DTAA was available to said recipients, their TDS
liability could not be more than rate prescribed under DTAA or Act
whichever was lower. In these cases the issue was pertaining to
Assessment years 2012-13 and 2016-17. The Assessee was engaged in
activity of Business Process Outsourcing (BPO). During relevant year,
assessee made payments of royalties and fees for technical services to
non-residents. Assessee deducted tax at source at rate of 10 per cent as
per provisions of section 115(A)(1)(b). Assessing Officer while issuing
intimation under section 200A, computed tax liability at rate of 20 per cent,
as provided under section 206AA. It was held that since there was no
dispute that benefit of DTAA was available to non-resident recipients, tax
liability of recipients could not be more than rate prescribed under
DTAA or Act whichever was lower.