COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION)-2 vs. MICRO FOCUS LTD.

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ITA - 239 / 2023HC Delhi24 April 20232 pages
For Petitioner: SANJAY KUMAR
AI SummaryDismissed

What did the High Court hold?

The High Court noted that the issue was identical to a previous case for AY 2015-16, which was decided based on the Supreme Court's ruling in Engineering Analysis Centre. The appeal was closed as no substantial question of law arose.

What were the facts?

The appeal concerned the taxability of income from software sales as royalty under the Indo-UK DTAA for AY 2017-18. The revenue argued that such income should be treated as royalty.

What were the issues?

Whether income derived from the sale of software constitutes royalty under the Indo-UK Double Taxation Avoidance Agreement.

AI-generated summary — verify with the full judgment below

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$~32 * IN THE HIGH COURT OF DELHI AT NEW DELHI + ITA 239/2023 COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATION)-2

..... Appellant Through: Mr Sanjay Kumar, Sr. Standing Counsel with Ms Hemlata Rawat & Ms Easha Kadian, Advocates.

versus

MICRO FOCUS LTD.

..... Respondent

Through: Ms Rajnandini, Advocate.

CORAM:

HON'BLE MR JUSTICE RAJIV SHAKDHER

HON'BLE MS JUSTICE TARA VITASTA GANJU

O R D E R %

24.04.2023 [Physical Hearing/Hybrid Hearing (as per request)] 1. This appeal concerns Assessment Year (AY) 2017-18. 2. The appeal seeks to assail the order dated 14.12.2022 passed by the Income Tax Appellate Tribunal [in short “the Tribunal”]. 3. Mr Sanjay Kumar, learned senior standing counsel, who appears on behalf of the appellant/revenue, has placed before us the order passed by the Court concerning the respondent/assessee for AY 2015-16. The order in ITA 94/2023, passed with respect to AY 2015-16 by the Court is dated 16.02.2023. 4. The issue in the AY under consideration in the above-captioned appeal and in the appeal i.e., ITA 94/2023, preferred by the appellant/revenue with regard to AY 2015-16 is, concededly, the same. ITA 239/2023

Page 1 of 2 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:44:48

5.

The issue which arises for consideration in the instant case is: whether income derived by the respondent/assessee from sale of software could be construed as royalty under the provisions of Indo-UK Double Taxation Avoidance Agreement (DTAA)? 6. Even according to Mr Sanjay Kumar, the issue is covered by the decision of the Supreme Court rendered in Engineering Analysis Centre of Excellence (P.) Ltd. v. CIT 432 ITR 471 (SC). 6.1 We may note that the appellant/revenue, apparently, has filed a review petition against the said decision. 7. Accordingly, the appeal is closed as no substantial question of law arises for our consideration, albeit, with the caveat that in case the appellant/revenue was to succeed in the review petition, parties will abide by the decision rendered therein.

RAJIV SHAKDHER, J

TARA VITASTA GANJU, J

APRIL 24, 2023 / ha

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ITA 239/2023

Page 2 of 2 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 27/03/2026 at 12:44:48

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