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2021 (10) TMI 655 - AT - Income TaxIncome accrued in India - Validity of assessing the sale proceeds of software sold to Indian customers as royalty income - assessee is a company incorporated and operating in Netherlands - DTAA entered between India and Netherlands - HELD THAT:- As assessee is granting license to the integrators and also authorizing the integrator to grant license only for the purpose of using the software. An identical issue of granting license to use software was examined in the context of its taxability as royalty by Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence[2021 (3) TMI 138 - SUPREME COURT]. Thus sale proceeds received by the assessee on sale of software licenses cannot be categorized as "Royalty" within the meaning of provisions of DTAA. Accordingly, we set aside the order passed by Ld. CIT(A) on this issue and direct the A.O. to delete the addition made as "royalty" income.- Decided in favour of assessee.
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