Union of India v. Azadi Bachao Andolan

Factive Limited, Mumbai vs. Assistant Commissioner of Income Tax, (International Taxation )-2(3)(1), Mumbai

In the result, both the appeals are partly allowed

Bench: Shri Saktijit Dey & Shri Girish Agrawal & Factive Limited Asst. Cit(It)-2(3)(1) C/O. Price Waterhouse & Co. Llp 609, 6Th Floor, Kautilya Bhavan, 252, Veer Savarkar Marg, C-41, C-43, G Block, Vs. Shivaji Park, Dadar, Bandra Kurla Complex, Mumbai-400 028 Bandra (E), Mumbai Pan/Gir No. Aaccf 5745 J (Appellant) : (Respondent) : Shri Dhanesh Bafna A/W Appellant By Shri Yogesh Malpani & Ms. Kinjal Patel Respondent By : Shri Krishna Kumar (Sr. Dr) Date Of Hearing : 21.08.2025 Date Of Pronouncement : 15.09.2025 O R D E R Per Saktijit Dey: Captioned Appeals By The Assessee Are Against The Final Assessment Orders Passed U/S. 143(3) R.W.S 144C(13) Of The Income Tax Act, 1961 (‘The Act’ For Short), In Pursuance To The Directions Of Learned Dispute Resolution Panel (‘Ld. Drp' For Short) & Pertains To The Assessment Years (A.Y.) 2021-22 & 2022-23. 2. Since The Substantive Issue On Merits, Arising In The Appeals Are More Or Less Common In Both The Appeals, We Propose To Take Up Ita No. 4706/Mum/2023, Pertaining To A.Y. 2021-22, As The Lead Appeal. (A.Ys. 2021-22 & 2022-23) Factive Limited Vs. Asst. Cit(It) 3. Ground Nos. 1, 2 & 3 Are Basically On Legal Issues, Challenging The Validity Of The Final Assessment Order. At The Outset, Ld. Counsel Appearing For The Assessee Submitted That He Would Prefer To Address The Issues On Merits And, If Warranted, May Press The Legal Grounds.

…sions of section 92 of the Act, the assessee is entitled to invoke the provisions of India –USA DTAA to the extent it is more beneficial. Our view is fortified by the decision of the Hon'ble Supreme Court in the case of Union of India Vs. Azadi Bachao Andalon 263 ITR 706. Accordingly, we will consider the beneficial provisions of the tax treaty to see whether the contention of the assessee that the alleged payment from DJCIPL is not royalty income. (A.Ys. 2021-22 & 2022-23) Factive Limited vs. Asst. CIT(IT) 11. As per Article 12 of the Tax Treaty, ‘Royalty” is defined as under: “10.1.4.1 (a) “payments of any kind…