“royalty income”

International TaxSection 9(1)(vi)Section 9(1)(vi)629 judgments

The decision most relied on for royalty income is Engineering Analysis Centre of Excellence (P) Ltd. v. CIT (432 ITR 471), cited in 914 judgments on BharatTax.

Leading authorities on royalty income

Engineering Analysis Centre of Excellence (P) Ltd. v. CIT

432 ITR 471 · 2021 · Supreme Court

914

citing judgments

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.

CIT v. Samsung Electronics Ltd.

345 ITR 494 · 2012 · High Court

461

citing judgments

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.

Asia Satellite Telecommunications Co. Ltd. v. DIT

332 ITR 340 · 2011 · High Court

359

citing judgments

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.

DIT v. New Skies Satellite BV

382 ITR 114 · 2016 · High Court

325

citing judgments

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

358 ITR 259 · 2013 · High Court

276

citing judgments

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.

39 Taxmann.com 88 · 2013 · High Court

269

citing judgments

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.

CIT v. Siemens Aktiongesellschaft

310 ITR 320 · 2009 · High Court

259

citing judgments

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

343 ITR 470 · 2012 · High Court

256

citing judgments

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

Gemological Institute of America, Inc., United States vs. The Assistant Commissioner of Income-Ta (International Taxation) - Circle 2(3)(2), Mumbai

In the result, appeals of the assesse are allowed partly for statistical

ITA 1293/MUM/2025[2022-23]Status: DisposedITAT Mumbai09 Sept 2025AY 2022-23

Bench: Shri Narendra Kumar Billaiya, Hon'Ble & Shri Anikesh Banerjee, Hon'Ble

For Appellant: Shri J.D. Mistry, Sr. Adv. & Shri Niraj Sheth, A/RsFor Respondent: Shri Satya Pal Kumar, CIT D/R a/w Shri Krishna Kumar, Sr. D/R

Section 144C(13)Section 147Section 148

year u/s.44DA of the Income-tax Act, 1961: 7:1 The Assessing Officer / the Dispute Resolution Panel have erred in holding that the royalty income is "effectively connected" with the alleged PE of the Appellant in India and is therefore taxable u/s.44DA of the Income ... misconceived and illegal and hence ought to be struck down. 7 : 3 The Appellant submits that the Assessing Officer be directed to tax the "royalty" income in accordance with the provisions of section 9(1)(vi) of the Income-tax Act, 1961 read with Article 12 of the India

Gemological Institute of America, Inc., United States vs. The Assistant Commissioner of Income-Tax (International Taxation), Circle 2(3)(2) - Mumbai, Mumbai

In the result, appeals of the assesse are allowed partly for statistical

ITA 1292/MUM/2025[2019-20]Status: DisposedITAT Mumbai09 Sept 2025AY 2019-20

Bench: Shri Narendra Kumar Billaiya, Hon'Ble & Shri Anikesh Banerjee, Hon'Ble

For Appellant: Shri J.D. Mistry, Sr. Adv. & Shri Niraj Sheth, A/RsFor Respondent: Shri Satya Pal Kumar, CIT D/R a/w Shri Krishna Kumar, Sr. D/R

Section 147Section 148

Temenos Headquarters Sa, Chennai vs. Assistant Commissioner of Income Tax, Chennai

In the result, the appeals filed by the assessee for assessment years 2022-

ITA 558/CHNY/2025[2022-23]Status: DisposedITAT Chennai28 Aug 2025AY 2022-23

Bench: Shri George George K & Shri S.R. Raghunathaआयकर अपील सं./Ita No.: 558/Chny/2025 धनिाजरण वर्ज / Assessment Year: 2022-23 & S.A. No.: 50/Chny/2025 [In I.T.A. No.558/Chny/2025] धनिाजरण वर्ज/Assessment Year: 2022-23

For Appellant: Shri. R. Sivaraman, AdvocateFor Respondent: Ms. Sita Krisnamoorthy, JCIT

Section 143(2)Section 143(3)Section 144C(5)

nature of royalty under the treaty provisions. That being the case, the receipt from annual maintenance charges being not ancillary or subsidiary to any royalty income cannot be brought to tax under Article 12(4)(a) of the tax treaty. Therefore, it has to be seen, whether it can come

Atyant Capital India Fund-I, Mumbai vs. Assistant Director of Income Tax (International) Tax Circle 1(1)(2), Mumbai

In the result, the appeal of the assessee is allowed

ITA 573/MUM/2025[2022-23]Status: DisposedITAT Mumbai28 Aug 2025AY 2022-23

Bench: Shri Vikram Singh Yadavshri Sandeep Singh Karhail

For Appellant: Shri Sunil M LalaFor Respondent: Shri Satya Pal Kumar, CIT-DR

Section 143(1)Section 250Section 251Section 74

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

Asst. Commissioner of Income Tax(It)-2(1)-2 Mumbai, Mumbai vs. Deloitte Touche Tohmatsu India LLP, Mumbai

In the result, all the appeals of the assessees are allowed

ITA 2723/MUM/2025[2019-20]Status: DisposedITAT Mumbai26 Aug 2025AY 2019-20

Bench: Shri Saktijit Dey, Hon'Ble & Shri Girish Agrawalassessment Year: 2019-20

For Appellant: Shri Niraj Sheth and Ms. Darshana Shah, AdvocatesFor Respondent: Shri Krishna Kumar, Sr. DR

Section 195(1)Section 195(2)Section 9(1)(vi)

attempt is to tax the same as business profit, which is never the focus of this discussion. 22. Let us consider the receipt of Royalty income in accordance with provisions of Double Taxation Avoidance Agreement. Under Double Taxation Avoidance Agreement, income is not determined, but tax is determined

Bain and Company, Usa vs. DCIT, Gurgoan

In the result, appeal of assessee in ITA Nos

ITA 3056/DEL/2023[2021-22]Status: DisposedITAT Delhi22 Aug 2025AY 2021-22

Bench: Shri Vijay Pal Rao & Shri Naveen Chandra

For Appellant: Shri Himanshu Sinha, AdvFor Respondent: Ms. Ekta Jain, CIT- DR

Section 143(3)

Ground No. 21-23 with respect to receipt of INR 14,57,058 as subscription fee is not liable to tax in India as royalty income under Section 9(i)(vi) of the Act and Article 12 of the DTAA, submitted that during the relevant year, the Appellant had entered ... relevant assessment year. The ld AR argued that the Ld. AO has erroneously characterized this receipt of INR 14,57,058/- as royalty income of the Appellant under the DTAA. The ld AR submitted that in terms of Article 12(3) of the DTAA, the term 'royalty' is the consideration

Bain & Company, Inc., Usa vs. DCIT Intl. Taxation Circle, New Delhi

In the result, appeal of assessee in ITA Nos

ITA 1677/DEL/2023[2020-21]Status: DisposedITAT Delhi22 Aug 2025AY 2020-21

Bench: Shri Vijay Pal Rao & Shri Naveen Chandra

For Appellant: Shri Himanshu Sinha, AdvFor Respondent: Ms. Ekta Jain, CIT- DR

Section 143(3)

M/S.Redington Distributions Pte Ltd., Singapore vs. ACIT, Intltaxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 894/CHNY/2025[2016-17]Status: DisposedITAT Chennai29 Jul 2025AY 2016-17

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

return in India as it did not earn any income in India. From AY 2012-13 and onwards, the assessee had derived royalty income in India which was offered to tax under the head ‘Income from Other Sources’. Later on, a tax survey was conducted at the premises of their ... guilty for furnishing inaccurate particulars of income. To substantiate the bonafides of the assessee, he pointed out that the assessee had been offering the royalty income to tax in India even though two views were possible at the material time when the returns of income were filed, and that later

M/S.Redington Distributions Pte Ltd., Singapore vs. ACIT, Intltaxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 893/CHNY/2025[2015-16]Status: DisposedITAT Chennai29 Jul 2025AY 2015-16

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

M/S. Redington Distribution Pte Ltd., Singapore vs. ACIT, Intl Taxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 892/CHNY/2025[2014-15]Status: DisposedITAT Chennai29 Jul 2025AY 2014-15

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

M/S. Redington Distribution Pte Ltd., Singapore vs. ACIT, Intl Taxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 891/CHNY/2025[2013-14]Status: DisposedITAT Chennai29 Jul 2025AY 2013-14

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

M/S.Redington Distributors Pte Ltd., Singapore vs. ACIT, Intl Taxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 890/CHNY/2025[2012-13]Status: DisposedITAT Chennai29 Jul 2025AY 2012-13

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

M/S.Redington Distribution Pte Ltd., Singapore vs. ACIT, Intl Taxation Circle-2(1), Chennai

In the result, all the appeals filed by the assessee stands allowed

ITA 889/CHNY/2025[2011-12]Status: DisposedITAT Chennai29 Jul 2025AY 2011-12

Bench: Shri Aby T. Varkey & Shri Jagadish

For Appellant: Mr. Percy PardiwalaFor Respondent: Mr. Shiva Srinivas, CIT

Section 144CSection 148Section 271(1)(c)

Shell Information Technology International Bv, Mumbai vs. Deputy Commissioner of Income Tax (International Taxation )-4(2)(1), Mumbai

ITA 1750/MUM/2025[2022-23]Status: DisposedITAT Mumbai28 Jul 2025AY 2022-23

Bench: SHRI RAHUL CHAUDHARY, JUDICIAL MEMBER SHRI PRABHASH SHANKAR (Accountant Member)

For Appellant: Shri Madhur AgarwalFor Respondent: Shri Satya Pal Kumar

Section 143(3)Section 144C(13)Section 144C(5)Section 2(24)Section 234BSection 270A

Further, the Assessing Officer was of the view that revenue from software access amounting to INR.83,74,43,533/- was in the nature of royalty income liable to tax in the hands of the Assessee under Section 9(1)(vi) read with Article 12(4) of the DTAA. Therefore

Sri Lanka Cricket, Sri Lanka vs. Assistant Commissioner of Income Tax (International Tax) Circle- 3 (1)(2), New Delhi

ITA 1603/DEL/2025[2018-19]Status: DisposedITAT Delhi28 Jul 2025AY 2018-19

Bench: Shri Challa Nagendra Prasad & Shri Avdhesh Kumar Mishra

Section 14Section 147Section 148Section 148ASection 154Section 234ASection 234BSection 270A

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘D': NEW DELHI BEFORE SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER AND SHRI

Oman Telecommunications Company Saog, Oman vs. Deputy Commissioner of Income Tax/ Circle International Tax 2(2)(2), Delhi

In the result, appeal is partly allowed

ITA 1023/DEL/2025[2018-19]Status: DisposedITAT Delhi23 Jul 2025AY 2018-19

Bench: Shri Prakash Chand Yadav & Shri Naveen Chandraoman Telecommunications Deputy Commissioner Company Saog Of Income Tax/Circle Vp Finance Office, Po Box 789, Vs. International Tax Postal Code 11, Ruwi Muscat, 2(2)(2), Delhi. Sultanate Of Oman Outside India Pan-Aabco4203F (Appellant) (Respondent) Assessee By Ms. Ananya Kapoor, Adv. Department By Shri Nikhil Kumar Govila, Cit-Dr Date Of Hearing 16/07/2025 Date Of Pronouncement 23/07/2025 O R D E R Per Prakash Chand Yadav, Jm: The Present Appeal Of The Assessee Is Arising Out From The Order Of Ld. Assessing Officer Dated 25Th December, 2024 Having Din & Order No. Itba/Ast/S/147/2024-25/1071556765(1) Dated 25/12/2024 & Relates To Assessment Year 2018-19. 2. Brief Facts Of The Case As Coming Out From The Orders Of The Authorities Below Are That The Assesse Is Foreign Company & Had Not Filed Return Of Income For The Impugned Year. Thereafter, The Case Of The Assessee Was Reopened U/S 148 Of The Income Tax Act, 1961 On The Ground That Assessee Has Received Certain Payments From Two Indian Entities Namely M/S Bharti Airtel Limited & M/S Vodafone Mobile Services Ltd & Has Not Shown Any Income In India. The Assessing Officer Was Of The View That The Service Provided By The Assessee To The Indian Entities Were In The Nature Of The Fts And, Hence, Taxable In India. The Oman Telecommunications Company Saog Vs. Dcit Assessing Officer Relied Upon The Provisions Of Section 9(I)(Vii) Of The Act Held That The Service Rendered By The Assessee Are In The Nature Of Technical Services And, Hence, The Same Are Taxable In India. Accordingly, The Assessing Officer Made Addition Of Rs. 11,81,52,790/. Drp Also Affirmed The View Of The Ao Vide Order Dated 4Th November, 2024. Thereafter, Ld. Ao Framed The Final Assessment Order.

Section 148Section 56Section 9Section 9(1)(vi)Section 9(1)(vii)

cost of repetition, we must observe, while framing draft assessment order, the Assessing Officer has characterized interconnectivity usage charges received by assessee as royalty income under section 9(1)(vi) of the Act. However, learned DRP has, apparently, disagreed with the Assessing Officer and recharacterized the interconnectivity usage charges ... specifically coming under any Articles of the Treaty. As discussed in the earlier part of the order, the Assessing Officer had treated it as royalty income, whereas, learned DRP has treated it as FTS and suggested for addition as FTS on substantive basis. The aforesaid facts clearly indicate that

Gdg Educational Trust, Sohna vs. Addl. CIT, Range- 1, Gurgaon

In the result, the appeal being ITA No

ITA 1057/DEL/2019[2013-14]Status: DisposedITAT Delhi09 Jul 2025AY 2013-14

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharma

For Appellant: Shri Amit Goel, AdvocateFor Respondent: Shri Om Prakash, Sr. DR

Section 234ASection 271(1)(c)Section 37(1)

another aspect of the matter. It is worthwhile to point out that the payee i.e., GD Goenka Pvt. Ltd. has duly shown the Royalty income in there Income Tax Return and taxes have been paid. There is no loss of revenue and, thus, the disallowance made by the assessing officer