9911796707
TMI Blog2022 (12) TMI 1349X X X X Extracts X X X X X X X X Extracts X X X X ..... me-tax Act, 1961 ["the Act"] for Assessment-Year ["AY"] 2015-16, the assessee has filed this appeal on following effective ground: "Learned Assessing Officer was not justified to decide the TDS on remittance of Rs. 24,33,853/- to University of Cambridge, UK, which is for examination fee, books purchased and teacher's training fee, considered as royalty paid and imposed tax and interest on the appellant." 2. Heard the learned Representatives of both sides at length and case-records perused. 3. Briefly stated the facts leading to the present appeal are such that the assessee is a society running an educational institution. It is also an authorized centre for conducting courses of Cambridge International Examination run by University of Ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Chancellor, Masters and Scholars of the University of Cambridge treated the receipts (exactly same as paid by assessee) as "Royalty", invoking the same legal provisions as in present appeal, and taxed in India. The matter travelled upto ITAT and the Hon'ble Delhi Bench, relying upon the decision of Hon'ble Supreme Court in the case of Engineering Analysis Center of Excellence Pvt Ltd. [2021] 432 ITR 471, was pleased to hold that the impugned receipts were not in the nature of "royalty". The relevant paragraphs of the decision are extracted below: "3. The common grievance is that the ld. CIT(A) was not justified in holding that the revenue received by the assessee on account of granting various licences is not taxable as 'Royalty Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examination related content, setting and marking of examinations is also taxable as Royalty Income under India-UK DTAA. 8. The assessee questioned the assessment order before the Ld. CIT(A) and strongly contented non-taxability of receipts as royalty. 9. The Ld. CIT(A) was convinced with the contention of the assessee and deleted the addition made by the AO by stating that the Assessing Officer has not provided any basis for taxability of receipts as royalty. 10. Before us, ld. DR strongly supported the findings of the AO but could not bring any distinguishing decision in favour of the revenue. 11. We have given thoughtful consideration to the orders of the authorities below. In our considered opinion, as per section 90 subsection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [2021] 432 ITR 471 wherein the Hon'ble Supreme Court, in a bunch of appeals, conclusively held as under: "168. Given the definition of royalties contained in Article 12 of the DTAAs mentioned in paragraph 41 of this judgment, it is clear that there is no obligation on the persons mentioned in section 195 of the income-tax Act to deduct tax at source, as the distribution agreements/EULAs in the facts of these cases do not create any interest or right in such distributors/end-users, which would amount to the use of or right to use any copyright. The provisions contained in the Income-tax Act (section 9(l)(vi), along with explanations 2 and 4 thereof), which deal with royalty, not being more beneficial to the assessees, have no applicat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e nature of "royalty". This view equally applies to the present assessee. For the sake of completeness and clarity, we may mention that the decision of ITAT, Delhi was in the matter of recipient i.e. M/s The Chancellor, Masters and Scholars of the University of Cambridge and the present-appeal before us is in the matter of payer. But that would not make any difference in the conclusion qua the nature of receipt/payment. Hence respectfully following the decision of Hon'ble ITAT, Delhi, we do hold that the payment made by assessee was not in the nature of "royalty" as claimed by revenue-authorities and hence does not attract TDS. Resultantly, the Ld. AO is directed to delete the demand of TDS and consequential interest created upon the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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