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2010 (2) TMI 46 - HC - Income TaxRoyalty – ITAT held that the payment of US $ 9,24,500/- by the assessee, as per the agreement dated 10.07.1996, to IMG Canada through IMC India, did not amount to a royalty payment under Article 13(3)(c) of the Double Taxation Avoidance Agreement (DTAA) entered into between India and Canada – held that - Commissioner of Income Tax (Appeals) failed to notice was that before any payment could be termed as a “royalty” under Article 13(3)(c), it would have to be either as consideration for the copyright or for the right to use a copyright in any of the four categories of works mentioned therein, namely, (i) literary; (ii) artistic; (iii) scientific work; and (iv) cinematographic films and films or tapes for radio or television broadcasting. What the Commissioner of Income Tax (Appeals) failed to note was that there was no transfer of a copyright or the right to use the copyright flowing from IMG Canada to the respondent / assessee and, therefore, any payment made by the respondent/ assessee to IMG Canada would not fall within Article 13(3)(c) of the said DTAA. - The reference in Article 13(3)(c) is to “any copyright” and it is not a reference to “any right – revenue appeal dismissed.
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