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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 9TH DAY OF SEPTEMBER, 2025 PRESENT THE HON'BLE MR. JUSTICE S.G.PANDIT AND THE HON'BLE MR. JUSTICE K. V. ARAVIND INCOME TAX APPEAL NO. 654 OF 2023 BETWEEN:
PR. COMMISSIONER OF INCOME TAX INTERNATIONAL TAXATION BMTC COMPLEX, KORAMANGALA, BANGALORE.
THE ASSISTANT COMMISSIONER OF INCOME TAX (OSD), INTERNATIONAL TAXATION, CIRCLE 2(1), BANGALORE. …APPELLANTS (BY SRI. E.I. SANMATHI, SENIOR STANDING COUNSEL)
AND:
M/S. CHARLES RIVER LABORATORIES INC., 251, BALLARDVALE STREET, WILMINGTON, MASSACHUSETTS 01887, UNITED STATES, PAN:AAGCC2596Q. …RESPONDENT (BY SRI. TANMAYEE RAJKUMAR, ADV.)
THIS APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 01/06/2023 PASSED IN IT(IT)A NO. 88/BANG/2023, FOR THE ASSESSMENT YEAR 2013-14, PRAYING TO 1) DECIDE THE FOREGOING QUESTION OF LAW AND/OR SUCH OTHER QUESTIONS OF LAW AS MAY BE FORMULATED
Digitally signed by MARIGANGAIAH PREMAKUMARI Location: HIGH COURT OF KARNATAKA
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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
BY THE COURT AS DEEMED FIT AND 2) SET ASIDE THE APPELLATE ORDER DATED 01/06/2023 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, ‘A’ BENCH, BANGALORE, AS SOUGHT FOR, IN THE RESPONDENT-ASSESSEE’S CASE, IN APPEAL PROCEEDINGS NO. IT(IT) A NO. 88/BANG/2023 (ANNEXURE-A) FOR A.Y. 2013-14 AND ETC.
THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE S.G.PANDIT AND HON'BLE MR. JUSTICE K. V. ARAVIND
ORAL JUDGMENT (PER: HON'BLE MR. JUSTICE S.G.PANDIT)
This appeal by the Revenue under Section 260-A of the Income Tax Act, 1961 is directed against the order dated 01.06.2023 passed by the Income Tax Appellate Tribunal, ‘A’ Bench, Bengaluru in appeal proceedings in IT(IT)A.Nos.37/Bang/2023 for the assessment year 2013- 14, raising the following substantial questions of law:
“1. Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in nature in concluding that once the “make available” clause involving provision
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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
of technical knowledge and technical services is satisfied then the services rendered do not qualify as FIS ignoring the terms and clauses of the agreement which establish that India personnel are trained by the assessee and thus satisfying the “make available” clause?
Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in not appreciating that the services rendered are in the nature of Fees for Technical Services?
Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in nature in not appreciating that the services rendered are in the nature of Fees for Technical Services?
Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in nature in concluding that the services rendered do not fulfill the criteria of ‘make available’ as mandated in DTAA?
Whether on the facts and in the circumstances of the case, the Tribunal’s order
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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
is perverse in holding that the receipts for services by the assessee is not FTS within the meaning of the provisions of Section 9(1)(vii) of the Act and Article 12 of India-USA DTAA?
Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in not justified in deciding the issue on the basis of decision in case of defendant Beers Minerals P. Ltd., when the said decision has not reached finality?”
The Tax effect shown in the appeal memorandum is Rs.1,02,67,696/-.
Heard learned counsel Sri.E.I.Sanmathi for appellants/Revenue and learned counsel Smt.Tanmayee Rajkumar, for the respondent. Perused the entire appeal papers.
Learned senior counsel Smt.Tanmayee Rajkumar for respondent referring to Circular No.9/2024 dated 17.09.2024 submits that the appeal would not be maintainable in view of increasing the monetary limit to
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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
Rs.2,00,00,000/- to file appeal. It is also submitted that the said Circular would apply to the pending appeals before the Hon’ble Supreme Court, High Courts and the Tribunals.
On the other hand, learned counsel Sri.Sanmathi.E.I., for appellants/Revenue would submit that this case would fall under exception clause 3.1(l) and
(ii) of Circular No.5/2024 dated 15.03.2024, since it is a case arising out of the DTAA.
On perusal of the exception clause, it is seen that the appeals of International taxation charges where the dispute relates to the applicability of the provisions of a Double Taxation Avoidance Agreement or otherwise is made exception.
But, in the instant appeal, applicability of the provisions of Double Taxation Avoidance Agreement is not in question. Therefore, the contention of the learned counsel for the appellant/Revenue is unsustainable.
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HC-KAR NC: 2025:KHC:35284-DB ITA No. 654 of 2023
In view of the fact that the tax effect is less than Rs.2,00,00,000/-, the appeal stands rejected.
Sd/- (S.G.PANDIT) JUDGE
Sd/- (K. V. ARAVIND) JUDGE
NC CT:bms List No.: 1 Sl No.: 20