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2023 (12) TMI 206 - AT - Income TaxIncome taxable in India - Taxability of the receipts as “Royalty" - HELD THAT:- The Bangalore Bench of the Tribunal in the case of Telefonica De Espana S. A, [2023 (9) TMI 280 - ITAT BANGALORE] had decided all the issues raised on merits in favour of the assessee i.e., with regard to taxability as royalty/FTS and alternatively under section 5(2) of the Act. The Bangalore Bench of the Tribunal had followed its earlier order in the case of Telefonica De Espana S. A [2023 (8) TMI 1375 - ITAT BANGALORE] as well as the judgment of the Hon’ble jurisdictional High Court in the case of VSL, [2016 (8) TMI 422 - KARNATAKA HIGH COURT] wherein held Revenue authorities have erred in construing that the income has accrued or arisen in India. The situs of the source of income in respect of payment received by a non resident i.e. NTOs would be the place where the non resident carries on its business and perform the business activities pursuant to which it received income. Once the situs is outside India, then in order to determine whether the payments made by a resident of India to a non resident involves element of income is to be examined u/s 9 and in the present case, the Assessing Officer has examined the applicability of section 9(1) (vi) & 9(1)(vii) i.e. the payments involve royalty as well as fee for technical services. - Decided in favour of assessee.
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