Authority For Advance Rulings
Dr. U. Muralidharan, In Re
Suhas C. Sen, J., Chairman; Dr. Mohini Bhussry & D.P. Sharma, Members
AAR No. 497 of 2000
7th March, 2001
Harihar Lal & G.C. Goyal, for the Applicant: R.K. Lachhiramak, for the concerned CIT
DR. MOHINI BHUSSRY :
The applicant is the general manager with M/s Timken Engineering and Research (India) (P) Ltd. (“TERPL”) a subsidiary company of M/s Timken Company, USA w.e.f. 1st Nov., 1998. He was earlier working with the parent company in USA, as a product development specialist. The applicant has sought a ruling under s. 10(5B) of the IT Act on the following questions : (a) Whether the applicant satisfies the definition of “technician” for the purpose of s. 10(5B); (b) Whether the applicant is entitled to exemption under s. 10(5B) of the IT Act, 1961.
The eligibility criteria under s. 10(5B) of the Act requires the applicant to be a technician, thereby meaning a person having specialised knowledge and experience in the fields referred to in the said section or such other field as the Central Government may specify by notification in the Official Gazette and who is employed in India in a capacity in which such specialised knowledge and experience are actually utilised. It is also essential that the applicant must not be resident in India in any of the four financial years immediately preceding the financial year in which he arrived in India.
As per the dates of arrival in India and other particulars submitted, it is reported that the applicant has been a non- resident in the four previous years preceding the year 1998-99. Coming to the qualifications of the applicant, he holds a M.Sc. & Ph.D. in mechanical engineering from Case Western Research University, Ohio, USA, and has specialised knowledge and experience in designing & development of tapered roller bearings and specialty steels. His responsibilities in his current assignment have been stated to be as under : (i) Leading a team of engineers in bearings design & development of technical solutions for bearings usage needs. (ii) Anchoring the establishment of a state of the art technological centre for design and development of industrial bearings. (iii) Lead role in establishing state of the art laboratories to conduct various bearing product measurements and product performance evaluations. (iv) Lead interface for collaborative initiatives with various Indian technical institutions and laboratories for development/design projects for industrial bearings in India and other countries in the region.
The Timken company and TERPL entered into a technical support services agreement as per which TERPL undertook to provide engineering research and support service to Timken. Such services include application engineering support to the worldwide operations of Timken, comprising, inter alia, bearings selection, bearings system analysis and bearing products design work.
The submissions made on behalf of both Revenue and of the applicant have been examined and we are of the view that as per his qualifications and the responsibilities undertaken by him he fulfils the requirements laid down in s. 10(5B) of the IT Act, 1961. Therefore, the questions raised in the application are answered in the affirmative as under : (a) Whether the applicant satisfies the definition of Yes “technician” for the purpose of s. 10(5B). (b) Whether the applicant is entitled to exemption under s. Yes 10(5B) of the IT Act, 1961.
[Citation : 254 ITR 322]