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2023 (6) TMI 966 - AT - Income TaxIncome deemed to accrue or arise in India - Taxability of royalty income received by the assessee on subscribers units from original equipment manufacturers (OEMs) located outside India and royalty income on infrastructure equipments - As per AO since the subscriber units(handsets/equipments) containing CDMA technology/patent is ultimately used in India by subscribers, the royalty connected to such patent would be taxable in India as the OEMs selling the subscribers units/equipments have PEs in India. - assessee is a non-resident corporate entity incorporated in USA HELD THAT:- Considering the submission of assessee that locking of CDMA subscriber units to make it India-specific or network carrier-specific, was discontinued in assessment year 2010-11 and thereafter, subscriber units available were open market handsets not locked in any specific service provider, in our view, the report of the technical expert do not have any relevance in so far as the impugned assessment years are concerned. In any case of the matter, the assessment order makes it clear that driven by the assessment order passed for the assessment year 2012-13, the AO has concluded that the royalty income received from OEMs located outside India is taxable in India. Pertinently, while deciding the appeals for the assessment years 2009-10 to 2012-13 [2018 (4) TMI 1362 - ITAT DELHI] the Tribunal, having taken note of the relevant facts and earlier decisions on the issue, has held that the royalty income received from OEMs located outside India is not taxable in India. Decided in favour of assessee.
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