“ royalty income ”

CIT v. Samsung Electronics Ltd.

Payments for the supply or use of computer software, where there is no transfer of copyright but only a right to use the copyrighted product, are generally considered business profits and not 'royalty' or 'fees for technical services' under the Income Tax Act, 1961 or relevant DTAAs. This principle also applies to transponder fees, which are not taxable as royalty.

345 ITR 494 · 2012 · High Court

461

Asia Satellite Telecommunications Co. Ltd. v. DIT

Payments by Indian residents to non-resident foreign software suppliers for software are considered royalty, constituting income deemed to accrue in India under section 9(1)(v), thereby requiring tax deduction at source under section 195.

332 ITR 340 · 2011 · High Court

359

DIT v. New Skies Satellite BV

Payments for the use of equipment, such as satellite transponders, do not constitute 'royalty' under Section 9(1)(vi) of the Income-tax Act, 1961, or under applicable tax treaties, especially when there is no transfer of the right to use a process or underlying technology.

382 ITR 114 · 2016 · High Court

325

358 ITR 259 · 2013 · High Court

An amendment to the Income Tax Act, such as the Finance Act, 2012 amendment to Section 9(1)(vi) defining royalty, does not automatically override or alter the definition of 'royalty' as provided in a Double Taxation Avoidance Agreement (DTAA) unless the DTAA itself is bilaterally amended. The definition of royalty in a DTAA remains unaffected by unilateral changes to domestic law.

DIT v. Nokia Networks OY

276

39 Taxmann.com 88 · 2013 · High Court

Payments for the supply of software along with telecom equipment are not in the nature of royalty if they are for the use of a copyrighted article, not the copyright itself. Such payments are not taxable in India in the absence of a Permanent Establishment (PE).

DIT v. Infrasoft Ltd.

269

CIT v. Siemens Aktiongesellschaft

Payments for the use of copyrighted software, without the transfer of any rights in the underlying copyright itself, do not constitute 'royalty' under the Income-tax Act or tax treaties. Such payments are often treated as business income, taxable only if a permanent establishment exists.

310 ITR 320 · 2009 · High Court

259

343 ITR 470 · 2012 · High Court

Reimbursements of actual expenses without any profit element are not taxable income. Additionally, mere amendments to the Income-tax Act do not override the provisions of Double Taxation Avoidance Agreements (DTAAs).

DIT v. Ericsson A.B

256

ITA 572/DEL/2017[2012-13]Status: DisposedITAT Delhi10 Oct 2023AY 2012-13

Payments for the use of copyrighted software or reimbursement of data processing costs do not constitute 'royalty' under Section 9(1)(vi) of the Income-tax Act or Article 12(3) of a DTAA where there is no transfer of copyright or rendering of services that "make available" technical knowledge. This position was later upheld by the Supreme Court.

Judgments citing royalty income

E Service Singapore Pte Ltd., Gurugram vs. DCIT (International Taxation), New Delhi

In the result, the appeals of the assessee in :

Bench: Shri Saktijit Dey & Shri N.K. Billaiya

For Appellant: Shri Satyen Sethi, AdvFor Respondent: Shri Vizay B. Vasanta, CIT- DR

Section 143(3)Section 9(1)(vi)

relevant findings read as under: “39. In ground No. 8, the assessee has challenged taxability of receipts from internet bandwidth charges as royalty income. 40. Briefly, the facts are, in course of assessment proceedings, the Assessing Officer noticed that though the assessee had received an amount of Rs.15 ... equipment in the form of lease line/router is provided by the assessee to the customer, the Assessing Officer proceeded to treat the receipts as royalty income under section 9(1)(vi) of the Act read with Article 12(3) of India-Singapore DTAA and added to the income

Hp Services (Singapore) Pte Ltd., Gurgaon vs. DCIT (International Taxation), New Delhi

In the result, the appeals of the assessee in :

ITA 2142/DEL/2016[2011-12]Status: DisposedITAT Delhi10 Oct 2023AY 2011-12

Bench: Shri Saktijit Dey & Shri N.K. Billaiya

For Appellant: Shri Satyen Sethi, AdvFor Respondent: Shri Vizay B. Vasanta, CIT- DR

Section 143(3)Section 9(1)(vi)

Indium IV (Mauritius) Holdings Limited, Mumbai vs. Deputy Comm. of Income Tax (International Taxation) 2(2)(1), Mumbai

In the result, appeal filed by the assessee is allowed

ITA 2423/MUM/2022[2017-18]Status: DisposedITAT Mumbai06 Oct 2023AY 2017-18

Bench: Shri Amit Shukla, Hon'Ble & Shri S. Rifaur Rahman, Hon'Bleindium Iv (Mauritius) Holdings Limited V. Dcit (International Transaction)-2(2)(1) Office 201, 2Nd Floor, Sterling Tower Room No. 1722, 17Th Floor Air India Building, Nariman Point 14 Poudriere Street, Port Louis Mumbai – 400 021 Mauritius Pan: Aacci4907P (Appellant) (Respondent)

Section 143(2)Section 144C(5)Section 2(24)Section 45Section 92C

Income while applying the provisions of DTAA for the other source. "The assessee has invoked the benefit of the Treaty only in respect of royalty income arising from the agreements entered into before 1-6-2005. In respect of agreements entered into on or after 1-6- 2005, the assessee ... offered royalty income at the rate of 10 per cent as per the provision of section 115JA. The concerned contracts are different: the source of income is different; and the provisions under which royalty income is taxable, are different and the assessee was, therefore justified in offering the royalty income

Kraft Foods Group Brands Llc, Mumbai vs. Assistant Commissioner of Income Tax (International Taxation)-3(1)(2), Mumbai

In the result, appeal filed by the assessee is partly allowed

ITA 2495/MUM/2022[2019-20]Status: DisposedITAT Mumbai27 Sept 2023AY 2019-20

Bench: Us Raising Following Grounds In Its Appeal: -

Section 143(2)Section 144C(5)Section 153Section 234BSection 270ASection 9(1)(vii)

accordingly, the assessment be treated as bad in law and be quashed, Addition of Tax Deducted at Source (TDS) of INR 10,260 on royalty income and TDS of INR 93.45.429 on support service income 4. erred in adding TDS of INR 10,260 to the returned royalty income ... ground that net royalty income was offered to tax (ie., gross income less TDS); 5. erred in adding TDS of INR 93,45,429 to the returned support service income of INR 3,62,36,081 on the ground that net support service income was offered to tax (ie, gross

Grewal Foundation, New Delhi vs. ITO, Ward Exemption 1(2), New Delhi

In the result, appeal of the assessee is allowed for statistical purposes

ITA 118/DEL/2023[2017-18]Status: DisposedITAT Delhi27 Sept 2023AY 2017-18

Bench: Dr. Brr Kumar & Ms. Astha Chandraasstt. Year: 2017-18

For Appellant: Shri Jaspal Singh, CAFor Respondent: Shri Vivek Kumar Upadhyay, Sr. DR

Section 199

return of income for AY 2017-18. It is also not in dispute that the deductor has credited royalty income of Rs. 42,38,926/- payable to the assessee in AY 2017-18 on which tax of Rs. 4,23,893/- has been deducted. On these facts, the claim ... Revenue in AY 2017-18 is due to the fact that the assessee, following cash system of accounting declared royalty income of Rs. 13,15,033/- on actual receipt basis in the return for AY 2017-18 and the balance of Rs. 25,00,000/- in AY 2018-19 notwithstanding

ACIT (It) 3(1)(1), Mumbai vs. Juniper Networks International B.V., Mumbai

Appeal of the revenue is dismissed

ITA 1592/MUM/2021[2013-14]Status: DisposedITAT Mumbai26 Sept 2023AY 2013-14

Bench: Shri Vikas Awasthy() & Ms. Padmavathy S. ()

Royalty either under the Income-tax Act or under the DTAA. 21. From the above it is clear that to be taxable as royalty income covered by article 12 of the DTAA the income of the assessee should have been generated by the "use of or the right

ACIT (It) 3(1) (1), Mumbai vs. M/S. Juniper Networks Int. B.V., Mumbai

Appeal of the revenue is dismissed

ITA 1591/MUM/2021[2016-17]Status: DisposedITAT Mumbai26 Sept 2023AY 2016-17

Bench: Shri Vikas Awasthy() & Ms. Padmavathy S. ()

Asstt. CIT (It)-3(1)(1), Mumbai vs. M/S. Juniper Networks International B.V, Mumbai

Appeal of the revenue is dismissed

ITA 1333/MUM/2021[2015-16]Status: DisposedITAT Mumbai26 Sept 2023AY 2015-16

Bench: Shri Vikas Awasthy() & Ms. Padmavathy S. ()

Softwareone Pte. Ltd., Singapore vs. ACIT, Circle-3(1)(2) Int.Taxation, New Delhi

In the result, appeals are allowed as indicated above

ITA 1840/DEL/2022[2019-20]Status: DisposedITAT Delhi25 Sept 2023AY 2019-20

Bench: Shri Saktijit Dey, Vice- & Dr. Brr Kumar

For Appellant: Ms. Ananya Kapoor, AdvFor Respondent: Sh. Vizay B. Vasanta, CIT-DR

ITA 1839/DEL/2022[2018-19]Status: DisposedITAT Delhi25 Sept 2023AY 2018-19

character of receipts are identical in the impugned assessment years, however, being conscious of the fact that such receipts are not taxable as royalty income, the Assessing Officer re-characterised them as FTS under the Act as well as under India-Singapore DTAA. She submitted, there being no change

Softwareone Pte.Ltd., Singapore vs. ACIT, Circle-3(1)(2) Int.Taxation, Delhi

In the result, appeals are allowed as indicated above

Bench: Shri Saktijit Dey, Vice- & Dr. Brr Kumar

For Appellant: Ms. Ananya Kapoor, AdvFor Respondent: Sh. Vizay B. Vasanta, CIT-DR

ITA 1514/DEL/2022[2019-20]Status: DisposedITAT Delhi25 Sept 2023AY 2019-20

Goto Technologies Ireland Unlimited Company (Formely Known As Logmeln Ireland Unlimited Company), Dublin vs. ACIT Circle International Taxation 2(2)(1), New Delhi

In the result, appeals are allowed

Bench: Shri Saktijit Dey, Vice- & Dr. Brr Kumarassessment Year: 2019-20 Goto Technologies Ireland Versus Acit, Circle 2(2)(1) Unlimited Company(Formerly International Taxation, Known As Logmein Ireland New Delhi. Unlimited Company), Dublin. Pan: Aaccl4273H (Appellant) (Respondent) Assessment Year: 2020-21 Goto Technologies Ireland Versus Acit, Circle 1(3)(1) Unlimited Company(Formerly International Taxation, Known As Logmein Ireland New Delhi. Unlimited Company),Ireland. Pan: Aaccl4273H (Appellant) (Respondent)

For Appellant: Sh. Chavali Narayan, CAFor Respondent: Sh. Vizay B. Vasanta, CIT-DR

ITA 1626/DEL/2023[2020-21]Status: DisposedITAT Delhi22 Sept 2023AY 2020-21

rival submissions and perused materials on record. The short issue arising for consideration is whether the subscription received from Cloud Services is taxable as royalty income. As we find, while considering identical issue in case of CIT vs. MOL Corporation (supra), Hon’ble jurisdictional High Court has upheld receipts from ... Accordingly, we hold that the income received by the assessee from Cloud Services is not taxable in India, as they cannot be treated as royalty income. Accordingly, we direct the Assessing Officer to delete the additions. Grounds are allowed. 7. In the result, appeals are allowed. Order pronounced

DCIT, Circle 3(1)(2) Intl. Taxation, New Delhi vs. Sheraton Overseas Management Corporation, Noida

In the result, appeals are dismissed

Bench: Shri Saktijit Dey, Hon’Ble Vice- & Dr. B.R.R. Kumarassessment Year: 2019-20 With Assessment Year: 2020-21 Dcit, Vs. Sheraton Overseas Circle -3(1)(2), Management Corporation, International Taxation, C/O- M/S. Nangia & Co. New Delhi Llp, A-109, Sector-136, Noida Pan :Aalcs8306H (Appellant) (Respondent)

ITA 1625/DEL/2023[2019-20]Status: DisposedITAT Delhi22 Sept 2023AY 2019-20

right to use trade name, the Indian hotels have paid license fee to the affiliates. The affiliates have also offered such license fee as royalty income. There is no dispute that the license fee paid to the affiliates have been taxed in India. It is the reasoning of learned Commissioner

DCIT, Circle-3(1)(2) Int. Taxation, New Delhi vs. Sheraton Overseas Mangaement Corporation, Noida

In the result, appeals are dismissed

ITA 1624/DEL/2023[2018-19]Status: DisposedITAT Delhi22 Sept 2023AY 2018-19

DCIT, Circle 3(1)(2), International Taxation, New Delhi vs. Sheraton Overseas Management Corporation, Noida

In the result, appeal is dismissed

Bench: Shri Saktijit Dey, Hon’Ble Vice- & Dr. B.R.R. Kumarassessment Year: 2018-19 Dcit, Vs. Sheraton Overseas Circle -3(1)(2), Management Corporation, International Taxation, C/O- M/S. Nangia & Co. New Delhi Llp, A-109, Sector-136, Noida Pan :Aalcs8306H (Appellant) (Respondent)

ITA 1613/DEL/2023[2019-20]Status: DisposedITAT Delhi22 Sept 2023AY 2019-20

DCIT Circle-3(1)(1), Intl. Taxation, New Delhi vs. Westin Hotel Management L.P., Noida

In the result, appeals are dismissed

Bench: Shri Saktijit Dey, Hon’Ble Vice- & Dr. B.R.R. Kumarassessment Year: 2018-19 With Assessment Year: 2019-20 Dcit, Vs. Westin Hotel Management Circle -3(1)(1), L.P., International Taxation, C/O- Nangia & Co., A-109, New Delhi Sector-136, Noida, Uttar Pradesh Pan :Aaafw9088N (Appellant) (Respondent)

ITA 1612/DEL/2023[2018-19]Status: DisposedITAT Delhi22 Sept 2023AY 2018-19

DCIT, Circle 3(1)(1), International Taxation, New Delhi vs. Westin Hotel Mmanagement L.P., Noida

In the result, appeals are dismissed

ITA 1905/DEL/2023[2020-21]Status: DisposedITAT Delhi20 Sept 2023AY 2020-21

Lionbridge Technologies Llc (Formerly Known As Lionbridge Technologies, Inc.), Usa vs. ACIT Circle International Tax. 2(2)(1), New Delhi

In the result, the appeal is allowed

Bench: Shri Saktijit Dey, Vice- & Dr. B.R.R. Kumarassessment Year: 2020-21 . Lionbridge Technologies Llc Vs. Acit, (Formerly Known As Lionbridge Circle International Tax - Technologies, Inc.), 2(2)(1), 890, Winter Street – Suite 225, New Delhi Waltham, Ma – 02451, Usa Pan :Aaecl2198K (Appellant) (Respondent)