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2015 (11) TMI 992 - AT - Income TaxTDS u/s 195 - whether the payments made for acquiring the shrink-wrap Software amounts to royalty u/s 9(1)(vi) and also Indo-Ireland DTAA and, therefore, tax at source required to be deducted as per the provision of sec. 195? - Held that:- Respectfully following the decision of the Hon’ble Karnataka High Court in the case of Samsung Electronics Co. Ltd., (2011 (10) TMI 195 - KARNATAKA HIGH COURT ) and also decision of the Co-ordinate Bench of this Tribunal in the assessee’s own case [2015 (11) TMI 923 - ITAT BANGALORE] we are of the opinion that the contentions raised by the assessee are not acceptable for the reason that the payment in question was consideration for the right to use copy right shrink-wrap software amounts to royalty within the meaning of sec. 9(1)(vi) of the Act and also Art 12 of the Indo- Ireland DTAA, therefore, grounds raised by the assessee are dismissed. In any view of the matter, in view of the provisions of section 90 of the Act, agreements with foreign countries DTAA would override the provisions of the Act. Once it is held that payment made by the respondents to the nonresident companies would amount to "royalty" within the meaning of article 12 of the DTAA with the respective country, it is clear that the payment made by the respondents to the non-resident supplier would amount to royalty. In view of the said finding, it is clear that there is obligation on the part of the respondents to deduct tax at source under section 195 of the Act and consequences would follow - Decided against assessee.
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