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2013 (9) TMI 793 - AT - Income TaxDisallowance of royalty - assessee is accessing a scientific work which is in the nature of intellectual property - whether the subscription fees paid by the assessee to WM constitute royalty for information concerning industrial, commercial or scientific experience and the same is taxable under section 19(1)(vi) and article 13(3) of the Double Taxation Avoidance Agreement with the U. K - Held that:- what is being assessed by the assessee was a scientific work which has a character of intellectual property compiled on the web- site for the purposes of the persons in the field of oil and gas exploration and production thereof. It is a segmented information and the product is in respect of a particular country or region. At the same time, as mentioned earlier, the assessee has been specifically denied the right to sub-licence, rent or loan any product, nor is the assessee authorised to create derivative work based upon any project except as otherwise expressly provided in the agreement. WM has granted a non-transferable and non-inclusive licence to use the confidential name and passwords, if any, subject to the condition to enter the restricted portion of the website for the sole purpose of down- loading to a permitted computer and reproducing in storage media of a permitted computer copies. The terms of the agreement shall end at 00.01 GM on the last of the then current terms unless such terms are extended or terminated. If the totality of the facts are analysed the information/know- ledge available to the assessee was made through a licence ; consequently, it is covered under the definition of "royalty" under the domestic law under section 9(1)(iv) and (vi) along with article 13(3) of the Double Taxation Avoidance Agreement with the U.K. - Decided against assessee.
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