TMI Blog2021 (12) TMI 1447X X X X Extracts X X X X X X X X Extracts X X X X ..... greements, is not the payment of royalty for the use of copyright in the computer software, and that the same does not give rise to any income taxable in India, as a result of which the persons referred to in section 195 of the Income Tax Act were not liable to deduct any TDS u/s 195 of the Income Tax Act. Decided against revenue. - T.C.A. Nos. 549, 554, 555 and 558 of 2021 and C.M.P. Nos. 19939, 19975, 19981 and 20008 of 2021 - - - Dated:- 20-12-2021 - Honourable Mr. Justice R. Mahadevan And Honourable Mr. Justice Mohammed Shaffiq For the Appellant : Mr. Karthik Ranganathan in all the appeals. For the Respondent : Mr. P. Chidambaram in all the appeals. COMMON JUDGMENT Judgment of the Court was delivered by R. MAH ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Taxmann 273 (Delhi) when the issues involved are clearly distinguishable to the present case on hand? 4. Whether on the facts and circumstances of the case and in law, the Tribunal was right in holding that its mere a transfer of right to use copyrighted article, without appreciating the fact that when a copyrighted article is permitted or licenses to be used for a fee, the permission involves the use of or the right to use the copyright embedded therein and hence, such 'right to use' amount to 'royalty' even in the provisions of DTAA concerned? 2. When these appeals are taken up for hearing today, the learned counsel appearing for both sides jointly submitted that the substantial questions of law raised herein h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at payments made to two companies no TDS is required to be deducted under Section 195 of the Income Tax Act? 3. We have heard Mr. Karthik Ranganathan, learned Senior Standing Counsel for the appellant/Revenue and Mr. N.V. Balaji, learned counsel for the respondent/assessee. 4. It is not disputed before us that the substantial questions of law, which have been raised in this appeal, have been answered in favour of the assessee in the decision of the Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence Private Limited v. Commissioner of Income Tax and another reported in (2021) SCC Online SC 159. 5. In the said decision, there were four categories of cases as mentioned below : 4. The app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any copyright. The provisions contained in the Income Tax Act (section 9 (1)(vi), along with explanations 2 and 4 thereof), which deal with royalty, not being more beneficial to the assessees, have no application in the facts of these cases. 173. Our answer to the question posed before us, is that the amounts paid by resident Indian endusers/distributors to non-resident computer software manufacturers/suppliers, as consideration for the resale/use of the computer software through EULAs/distribution agreements, is not the payment of royalty for the use of copyright in the computer software, and that the same does not give rise to any income taxable in India, as a result of which the persons referred to in section 195 of the Income Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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