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2017 (3) TMI 1742 - AT - Income TaxRoyalty receipt - License fee for the use of customized software received by the assessee from its affiliate concern - DTAA between India and Sweden - income accrued and taxable in India - services rendered by assessee company to its Indian group companies - HELD THAT:- Assessee is providing IT support and advisory services for solving IT related problems by its users and various application softwares. In order to qualify the payment as Royalty, it is necessary to establish that there is transfer of all or any rights (including the granting of any licence) in respect of copyright of a literacy, artistic or scientific work. Further in order to meet the consideration paid by the licencee as royalty, it is to be established that the licencee by making such payments has obtained all or any of the copyright rights. The assessee has not made available any technical knowledge or expertise to the recipient Indian company. In our opinion, the assessee has only provided the back-up services and IT support services for solving IT related problems to its Indian subsidiary. Hence, unless and until the services are not made available, same cannot be taxable in India The issue is identical to that of Sandvik Australia Pty. Ltd. [2013 (4) TMI 643 - ITAT PUNE]. We therefore following the aforesaid decision and INFRASOFT LTD. [2013 (11) TMI 1382 - DELHI HIGH COURT]held that the amount received by assessee cannot be considered to be royalty or FTS and therefore not taxable in India. We therefore hold accordingly. Thus, the grounds of the assessee are allowed.
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