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2014 (12) TMI 389 - HC - Income TaxConsideration receivable as per agreement to be treated as Industrial or Commercial Profits or not – Article III of India and German DTAA - Held that:- Assessee is a non-resident company incorporated in West Germany and derived income in the relevant previous year by way of fees from Precision Bearings India Limited - This income was derived pursuant to agreements dated 29th January, 1972, 18th August, 1979 and 3rd August, 1981, the taxability of the income derived in such agreements is governed, apart from the provisions of the Income Tax Act, 1961 also by an agreement for Avoidance of Double Taxation between Government of India and Federal Republic of Germany - The recipient of the income did not have permanent establishment in India - the Tribunal has referred the question and to seek an answer as to whether the amount received would fall within the purview of the term 'Royalty' used in para 5 Article III (sic) of this Double Taxation Avoidance Agreement - the Tribunal was rightly of the view that 80% of the amount is taxable as royalty – thus, the order of the Tribunal is upheld – Decided against assessee.
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