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2021 (11) TMI 1000 - ITAT PUNEAddition of software usage charges received treated as royalty - use the copyrighted software - proof of parting with copyright as envisaged within the meaning of Section 14 of the Copyright Act - HELD THAT:- The assessee has merely transferred the right to use copyrighted software ANTIFOG and that it had not transferred the copyright itself to Trigo India. TRIGO India was authorized to have access to and make use of the copyrighted software ANTIFOG. In the Software License Agreement entered into, it is evident that the assessee i.e. Trigo SAS is ‘Licensor’ and TRIGO Quality Production Services Pvt. Ltd. which is Indian Company as a ‘Licensee’. That the various clauses of this Software License Agreement verified the fact that copyright of the software ANTIFOG is very much with Trigo SAS (Licensor) and that the Trigo India (Licensee) has been authorized to use the software ANTIFOG as per various terms and conditions specified in this Software License Agreement. There is no difference in facts of the present case as compared to the facts of the judgment in the case of Engineering Analysis Centre of Excellence Pvt. Ltd. [2021 (3) TMI 138 - SUPREME COURT] which was referred by the Tribunal in Ansys Inc. [2021 (6) TMI 513 - ITAT PUNE] There has been no parting with copyright as envisaged within the meaning of Section 14 of the Copyright Act by the Licensor (assessee) to Licensee who is given access to only use the copyrighted software against which assessee’s receipts cannot be taxed as royalty. Therefore, respectfully following the judicial precedents mentioned aforesaid on this issue - Grounds No.1 & 2 raised in appeal by the assessee are allowed. Addition of management service fees received by the assessee treating it as ‘fees for technical services’ - HELD THAT:- Whatever services were provided by the assessee to Trigo India, no technical knowledge was made available by the assessee to the Indian Entity. Rather, it is a case of providing a service involving technical knowledge, which got consumed with its provision itself. Since such services simply involve use of technical knowledge and do not result into handing over some technical know-how to the recipient of the services. DR could not bring on record any materials/evidences to suggest that the facts and circumstances in the case of the present assessee was different from the case of the M/s. Faurecia Automotive Holding [2019 (7) TMI 402 - ITAT PUNE] Moreover, on going through the services agreement, it is absolutely clear that whatever services were rendered by the assessee to the Trigo India was services of such nature which got immediately consumed on delivery. There is no part of technical know-how made available by which the Indian Entity could have used services later on its own - Also as relying on the case of CIT Vs. De Beers India Minerals Pvt.Ltd [2012 (5) TMI 191 - KARNATAKA HIGH COURT] we allow Grounds No. 3 & 4 of the assessee. Levy of education cess on the tax liability computed under the provisions of the India France DTAA - HELD THAT:- . Having heard the parties herein and considering the decision of the Mumbai Bench of the Tribunal in the case of Sunil V Motiani [2013 (12) TMI 1105 - ITAT MUMBAI] to hold that tax payable @ 12.5% under Article 11(2) of FTAA is inclusive of surcharge and education cess. - on the same parity of reasoning, we provide relief to the assessee. Thus, Ground No.5 raised in the appeal by the assessee is allowed.
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