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2017 (3) TMI 331 - AT - Income TaxRoyalty receipt - receipt from the sale of software products to clients in India through its distributor / reseller - P.E. in India - taxability in India - Held that:- The present case has been decided in view of the latest law settled by the Hon’ble Delhi High Court in case of Ericsson AV (2011 (12) TMI 91 - Delhi High Court). As decided in assessee's own case in previous year receipt on account of sale of Shrink-wrap software is not in the nature of royalty hence is not liable in India in view of the provision of section 9(1)(iv) of the Act as well as Article 12(3) of the Double Taxation Avoidance Agreement between India and U.S.A. In view of the said circumstances, we are of the view that the case of the assessee is fully covered by the above mentioned decisions and the finding of the Assessing Officer is based upon the DRP direction is wrong against law and facts and is hereby ordered to be set aside on this issue. It is therefore held that receipt on account of the receipt for sale of shrink-wrap software is not liable to tax in India. Therefore, the Assessing Officer is hereby directed to delete the full addition. Accordingly, these issues are decided in favour of the assessee against the revenue.
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