2016 (4) TMI 1403 - HC - Income Tax

Income chargeable to tax in India - Royalty Income - Whether fees received can be treated as royalty as defined under section 9(l)(vi) of the Income-tax Act 1961 and under Article 12 of the applicable DTAA? - HELD THAT - As conceded the questions which arise for consideration are already answered by the decision of this Court in the case of Commissioner of Income Tax Vs. Synopsis International Old Ltd. 2013 (2) TMI 448 - KARNATAKA HIGH COURT . However she submitted that the matter is carried before the Apex Court. When the issues are already covered by the above referred decision of this Court we do not find that any substantial question of law would arise for consideration.

Summary

Issues:
1. Interpretation of Tribunal's reliance on previous judgments in dismissing appeals.
2. Determination of whether payments received by the appellant constituted 'royalty' under relevant tax laws.

Analysis:
1. The appellant raised questions regarding the Tribunal's dismissal of appeals based on previous judgments. The appellant contested the Tribunal's reliance on the judgment of the High Court in a specific case and earlier orders of the Tribunal in the appellant's own appeals for different assessment years. The main contention was whether the Tribunal was justified in dismissing the appeals by referencing past decisions. The appellant sought clarification on the correctness of the Tribunal's approach in dealing with the appellant's case in light of the previous judgments.

2. The second issue revolved around whether the payments received by the appellant should be considered as 'royalty' under Explanation 2 to Section 9(1)(vi) of the Income-tax Act, 1961, and under Article 12 of the applicable Double Taxation Avoidance Agreement (DTAA). The Tribunal had confirmed the assessment orders, concluding that the payments received by the appellant were indeed 'royalty,' leading to taxable income in India. The appellant challenged this determination, questioning the characterization of the payments and their tax implications as per the relevant provisions of the law.

In the judgment, it was noted that the appellant's counsel acknowledged that the questions raised were addressed in a prior decision of the Court in the case of Commissioner of Income Tax Vs. Synopsis International Old Ltd. The appellant indicated that the matter was being pursued before the Supreme Court. The Court, considering the issues already covered by the previous decision, found no substantial question of law for further consideration. Consequently, the Court dismissed the appeals, indicating that the issues raised had been addressed in a previous judgment and did not warrant additional scrutiny.