Tax Management India. Com
                        Law and Practice: A Digital eBook ...

Latest Cases

TMI - Tax Management India. Com
Case Laws Acts Notifications Circulars Classification Forms Manuals SMS News Articles
Highlights
D. Forum
What's New

Share:      

        Home        
 

TMI Blog

Home List
← Previous Next →

2015 (4) TMI 1273

..... M/s Wipro Ltd [2010 (8) TMI 1053 - KARNATAKA HIGH COURT] was regarding allowability of expenditure of imported software whether capital in nature or revenue. There was no issue before the Hon’ble High Court whether the said expenditure was in the nature of royalty and only a passing reference was made by the Hon’ble High Court that the Commissioner rightly pointed out that it is not a royalty. In any case, when the prior decision in case of CIT Vs M/s Synopsis International Ltd [2013 (2) TMI 448 - KARNATAKA HIGH COURT] and in the latest decision in the case of M/s Samsung Electronics Co. Ltd. [2011 (10) TMI 195 - KARNATAKA HIGH COURT] on the issue of payment being royalty then the contention raised by the learned AR is devoid of .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... in hardware, the appellant has only purchased copyrighted article , which were not liable for deduction of tax at source under the provisions of the a/Ct as well as under India -USA DTAA or India-Singapore DTAA; and iii) the payment for computer software licenses was not liable for deduction of tax at source u/s 195 of the Act, as the said payments do not comprise of income chargeable to tax in India. 4. The ld.AO and CIT(A)-IV have erred in concluding that;- i) The payment made by the appellant is taxable Royalty both under the Act ad India-USA DTAA or India- Singapore DTAA. ii) The payment made by the appellant is towards copyright in the software license; iii) The payment made for transferable right to use enduser license and therefore, .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... arious payments to oversee vendors without deduction of tax at source u/s 195 of the Act and claimed that these payments were towards purchase of copyright articles and therefore, there was no income chargeable to tax in the hands of the recipient. The AO while passing the order u/s 201(1) and 201!A) of the IT Act dated 20- 03-2012 held that the assessee is in default for non-deduction of tax u/s 195 of the IT Act, 1961 because the payment made by the assessee is a royalty payment and therefore, the same is taxable in India. The assessee challenges the action of the AO before the CIT(A), but could not succeed. The CIT(A) has confirmed the action of the AO by following the judgment of the jurisdictional High Court in the case of CIT Vs M/s S .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... ell as the relevant material on record. At the outset, we find that the issue of payment of royalty in the case of M/s Samsung Electronics Ltd. (Supra) has been decided by the Hon ble High Court against the assessee and in favour of the revenue the learned AR has submitted that a different view has been taken by the jurisdictional High Court in the case of M/s Wipro Ltd and therefore, the judgment in the case of M/s Samsung Electronics Co.Ltd (Supra) should be treated as per in curiam, because the earlier decision of the Division Bench was not followed while deciding the case of M/s Samsung Electronics Co. Ltd (Supra). There is no dispute that the Tribunal is bound by the decision of the jurisdictional High Court and in case of different vi .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... that the Commissioner rightly pointed out that it is not a royalty. In any case, when the prior decision in case of CIT Vs M/s Synopsis International Ltd (Supra) and in the latest decision in the case of M/s Samsung Electronics Co. Ltd. (Supra) on the issue of payment being royalty then the contention raised by the learned AR is devoid of any merits. The Tribunal in case of M/s Synopsis International Ltd. (Supra) for the assessment year : 2006-07, has decided an identical issue against the assessee by following the judgment of the Hon ble High Court in case of M/s Samsung Electronics Co. Ltd (Supra). The CIT(A) has reproduced the relevant finding of this Tribunal in the case of M/s Synopsis International Ltd. in para 4.3 of the impugned or .....

X X X X X X X

Full Text of the Document

X X X X X X X

..... Act as well as Article-12 of the DTAA between India and Ireland. Held; It is not in dispute before us that an identical issue has been considered by the Hon ble Karnataka High Court in the case of CIT Vs M/s Samsung Electronics Co. Ltd & Others 245 CTR (Kar.) 481 has held that payment to nonresident foreign software suppliers for purchase of shrink wrapped software was in the nature of royalty. The Hon ble Court held that what is granted under the license is only a license to use the software for internal business without having any right for making any alteration or reverse engineering or creating sub-license while the copyright continues to be with the non-resident as per the agreement. That even as per the agreements entered into wi .....

X X X X X X X

Full Text of the Document

X X X X X X X

 

 

← Previous Next →

 

 

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || Database || Members || Refer Us ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.
|| Blog || Site Map - Recent || Site Map ||