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“Section 9(1)(vii)”

Section References (mined)Section 9Section 9(1)(vii)933 judgments

The decision most relied on for Section 9(1)(vii) is Engineering Analysis Centre of Excellence (P) Ltd. v. CIT (432 ITR 471), cited in 914 judgments on BharatTax.

Leading authorities on Section 9(1)(vii)

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.

Ishikawajima Harima Heavy Industries Ltd. v. DIT
288 ITR 408 · 2007 · Supreme Court
394
citing judgments

Income from offshore supply of goods and services is not taxable in India if the entire transaction, including transfer of ownership and payments, occurs outside India.

CIT v. De Beers India Minerals (P.) Ltd.
346 ITR 467 · 2012 · High Court
371
citing judgments

For fees for technical or consultancy services to 'make available' technical knowledge or know-how under a DTAA, the service must transmit such knowledge, allowing the recipient to derive an enduring benefit and utilize it independently in the future.

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).

CIT v. Toshoku Ltd.
125 ITR 525 · 1980 · Supreme Court
270
citing judgments

A non-resident commission agent is not chargeable to tax in India on commission income if no business operations are carried out in India. Consequently, no TDS is required under Section 195 on such payments.

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.

Judgments citing Section 9(1)(vii)

DCIT, Intl. Taxn., Circle 1(2), Bangalore vs. Ibm Deutschland Gmbh, India

In the result, the appeal filed by the revenue is hereby dismissed

ITA 1312/BANG/2024[2014-15]Status: DisposedITAT Bangalore23 Aug 2024AY 2014-15

Bench: Shri Waseem Ahmed & Shri Yogesh Kumar Us

For Appellant: Shri Sharath Rao, CA, Dhiraj R, AdvocateFor Respondent: Shri Subramanian S, JCIT
Section 143(3)Section 147Section 148Section 201Section 9(1)(vii)

assessee in the year under consideration which was in the nature of fees for technical services in the manner provided under section 9(1)(vii) of the Act and also as per the provisions of the DTAA between India and Germany. IBM India did not deduct any TDS on such

Cma Cgm Agencies India Private Limited, Elphinstone Road-West, Mumbai vs. Deputy Commissioner of Income Tax, Circle 1(1), Pune

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

ITA 1454/PUN/2023[2013-14]Status: DisposedITAT Pune22 Aug 2024AY 2013-14

Bench: Shri G. D. Padmahshali & Shri Vinay Bhamoreआयकर अपील सं. / Ita No.1454/Pun/2023 िनधा"रण वष" / Assessment Year : 2013-14 Cma Cgm Agencies India Vs. Dcit, Circle-1(1), Pune. Private Limited, One International Centre, Tower-3, 8Th Floor, Senapati Bapat Marg, Elphistone Road- West, Mumbai- 400013. Pan : Aadcc3951G Appellant Respondent Assessee By : Mahenov Thakkar Revenue By : Shri Nitin Patil Date Of Hearing : 24.07.2024 Date Of Pronouncement : 22.08.2024 आदेश / Order Per Vinay Bhamore, Jm: This Appeal Filed By The Assessee Is Directed Against The Order Dated 03.11.2023 Passed By Ld Cit(A)/Nfac For The Assessment Year 2013-14. 2. The Appellant Raised The Following Grounds Of Appeal :- “Disallowance Under Section 40(A)(Ia) Of The Act Amounting To Rs.4,86,77,518/- 1. Erred In Upholding The Action Of The Learned Assessing Officer (‘Ao’) & Holding That Payment Of It Services To Be In The Nature Of Royalty Under Section 9(1)(Vi) Of The Act/ Fees For Technical Services Under Section 9(1)(Vii) Of The Act;

For Appellant: Mahenov ThakkarFor Respondent: Shri Nitin Patil
Section 143(2)Section 143(3)Section 194JSection 195Section 271(1)(c)Section 40Section 9(1)(vi)Section 9(1)(vii)

services to be in the nature of royalty under section 9(1)(vi) of the Act/ fees for technical services under section 9(1)(vii) of the Act; 2 2. erred in not following the ruling of the Hon'ble Income-tax Appellate Tribunal in the Appellant's own case ... wherein it was held that the charges paid towards leased line are not in the nature of Technical services within the meaning of section 9(1)(vii) of the Act. The relevant paragraphs of the judgment of Hon’ble Apex court read as under : “5. The relevant provisions

Coursera Inc., United States of America vs. Assistant Commissioner of Income Tax, Circle 1(2)(1), International Taxation, Delhi

In the result, the appeals are allowed

ITA 3646/DEL/2023[2021-22]Status: DisposedITAT Delhi21 Aug 2024AY 2021-22

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

Section 143(3)Section 144CSection 9(1)(vii)

certain amounts received by the assessee from Indian customers as Fee for Technical Services (FTS)/Fee for Included Services (FIS) in terms with section 9(1)(vii) of the Act and Article 12(4) of India – USA Double Taxation Avoidance Agreement. 3. For the sake of convenience, we will take

Coursera Inc., United States of America vs. Assistant Commissioner of Income Tax, Circle 1(2)(1), International Taxation

In the result, the appeals are allowed

ITA 2416/DEL/2023[2020-21]Status: DisposedITAT Delhi21 Aug 2024AY 2020-21

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

Section 143(3)Section 144CSection 9(1)(vii)

certain amounts received by the assessee from Indian customers as Fee for Technical Services (FTS)/Fee for Included Services (FIS) in terms with section 9(1)(vii) of the Act and Article 12(4) of India – USA Double Taxation Avoidance Agreement. 3. For the sake of convenience, we will take

John Wiley and Sons, Inc., U. S vs. DCIT Circle 2(1)(2), International Taxation, New Delhi

In the result, the appeal of the assessee is allowed

ITA 2344/DEL/2023[2020-21]Status: DisposedITAT Delhi21 Aug 2024AY 2020-21

Bench: Dr. B. R. R. Kumar, Sh. Sudhir Pareek

For Appellant: Sh. Vishal Kalra, Adv. &For Respondent: Sh. Vijay B. Vasanta, CIT-DR
Section 143(3)Section 144C(13)Section 270ASection 9(1)(vi)Section 9(1)(vii)

received by the Appellant for sale of online journals or books constitutes Fees for Technical Services (“FTS”) /' Fees for Included Services (“FIS”) under section 9(1)(vii) of the Act read with Article 12 of India-USA tax treaty. 3.1. That on the facts and in circumstances of the case ... appreciate that receipts for services provided to Indian customers merely constitute standard services provided without human intervention, thereby not constituting FTS under section 9(1)(vii) of the Act or FIS Article 12 of the India-USA tax treaty. 3.2. That on the facts and in the circumstances

Backbase Europe Bv, Netherlands vs. ACIT Circle Intl. Taxation- 1(1)(2), New Delhi

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

ITA 3399/DEL/2023[2021-22]Status: DisposedITAT Delhi20 Aug 2024AY 2021-22

Bench: Shri Saktijit Dey & Shri Brajesh Kumar Singh3399/Del/2023 [Assessment Year: 2021-22]

Section 143(3)Section 9(1)Section 9(1)(vii)

being the amount received from IDFC Bank Ltd as Software Consultancy Charges as fee for technical services on the application of section 9(1)(vii) of the Act in the computation of taxable total income without assigning proper reasons and justification. 3. The ACIT / DRP erred in bringing ... being the amount received from HDFC Bank Ltd as Software Consultancy Charges as fee for technical services on the application of section 9(1)(vii) of the Act in the computation of taxable total income without assigning proper reasons and justification. 4. The ACIT / DRP erred in bringing

Income Tax Officer, Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1377/DEL/2024[2018-19]Status: DisposedITAT Delhi16 Aug 2024AY 2018-19

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Income Tax Officer, Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1376/DEL/2024[2017-18]Status: DisposedITAT Delhi16 Aug 2024AY 2017-18

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Income Tax Officer, Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1375/DEL/2024[2016-17]Status: DisposedITAT Delhi16 Aug 2024AY 2016-17

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Income Tax Officer, Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1374/DEL/2024[2015-16]Status: DisposedITAT Delhi16 Aug 2024AY 2015-16

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Income Tax Officer, Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1373/DEL/2024[2014-15]Status: DisposedITAT Delhi16 Aug 2024AY 2014-15

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Income Tax Officer, New Delhi vs. Hcl Technologies Limited, New Delhi

In the result, appeal is partly allowed

ITA 1372/DEL/2024[2013-14]Status: DisposedITAT Delhi16 Aug 2024AY 2013-14

Bench: Shri Saktijit Dey, Hon’Ble & Shri M. Balaganesh

For Appellant: Shri Ajay Vohra, Sr. AdvFor Respondent: Shri T. James Singson, CIT DR
Section 195Section 201Section 201(1)Section 9

onsite services to the customers outside India and therefore, in terms of first limb of the exception carved out in clause (b) of section 9(1)(vii) of the Act, the amount paid by the Assessee to the foreign AEs for the services utilized for business of onsite services carried ... Assesseeand thus, the receipts cannot be taxed in the hands of the foreign AEs in terms of second limb of exception under section 9(1)(vii)(b) of the Act. (Para no. 25-27, Page No.46-50) Re: (IV)Taxability under the DTAAs - No findings returned 1. The Hon'ble Tribunal

Maersk Logistics & Services International B.V (Erstwhile Damco International B.V), Mumbai vs. DCIT, International Taxation Circle 3(2)(1), Mumbai

ITA 4345/MUM/2023[2021-22]Status: DisposedITAT Mumbai14 Aug 2024AY 2021-22

Bench: Shri Narendra Kumar Billaiya, Hon'Ble & Shri Rahul Chaudhary, Hon'Bleι.Τ.Α. No. 4345/Mum/2023

For Appellant: Shri Manish Kanth, A/RFor Respondent: Shri Anil Sant, Addl. CIT, D/R
Section 143(3)Section 9(1)(vii)

explanation of the assessee did not find favour with the AO who was of the firm belief that as per Explanation 2 to Section 9(1)(vii) of the Act, FTS has been defined as any consideration for rendering any managerial, technical or consultancy services and the taxability

Maersk Logistics & Services International A/S ( Erstwhile, Damco International A/S), Mumbai vs. DCIT, International Taxation Circle 3(2)(1), Mumbai

ITA 4325/MUM/2023[2021-22]Status: DisposedITAT Mumbai14 Aug 2024AY 2021-22

Bench: Shri Narendra Kumar Billaiya, Hon'Ble & Shri Rahul Chaudhary, Hon'Bleι.Τ.Α. No. 4345/Mum/2023

For Appellant: Shri Manish Kanth, A/RFor Respondent: Shri Anil Sant, Addl. CIT, D/R
Section 143(3)Section 9(1)(vii)

explanation of the assessee did not find favour with the AO who was of the firm belief that as per Explanation 2 to Section 9(1)(vii) of the Act, FTS has been defined as any consideration for rendering any managerial, technical or consultancy services and the taxability

ACIT, New Delhi vs. Shri Bhawan Mohan Garg, New Delhi

In the result, the appeal of the revenue is dismissed

ITA 2624/DEL/2017[2011-12]Status: DisposedITAT Delhi13 Aug 2024AY 2011-12

Bench: Sh. S. Rifaur Rahman & Sh. Sudhir Kumarassessment Year: 2011-12 Acit Vs Bhawan Mohan Garg Circle – 32 (1) C-16, Green Park New Delhi Extension, New Delhi Pan No.Aahpg2084K (Appellant) (Respondent)

Section 143(2)Section 143(3)Section 145Section 195Section 40Section 40t

appellant. In view of these facts, I am of the opinion that the case of appellant is not covered by the provisions of Section 9(1)(vii) of the Act either. Therefore, the addition mad by the AO is deleted and the ground of appeal is allowed. 8. We have

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2415/MUM/2023[2014-15]Status: DisposedITAT Mumbai12 Aug 2024AY 2014-15

Bench: SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

paid to non- resident under Section 195 of the Act as the same were chargeable to tax in India in terms of Section 9(1)(vii) of the Act read with either Article 12 or Article 22/23 of the corresponding DTAAs as FTS or Other Income, respectively. Since the Assessee ... Table in paragraph 5 above] it was contended that professional fee were not liable to tax in India in terms of Section 9(1)(vii)(b) of the Act for the reason the same were utilized outside India and/or for earning income from source outside India. [Refer to Note

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2414/MUM/2023[2015-16]Status: DisposedITAT Mumbai12 Aug 2024AY 2015-16

paid to non- resident under Section 195 of the Act as the same were chargeable to tax in India in terms of Section 9(1)(vii) of the Act read with either Article 12 or Article 22/23 of the corresponding DTAAs as FTS or Other Income, respectively. Since the Assessee ... Table in paragraph 5 above] it was contended that professional fee were not liable to tax in India in terms of Section 9(1)(vii)(b) of the Act for the reason the same were utilized outside India and/or for earning income from source outside India. [Refer to Note

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

Accordingly, Ground No. 5 & 6 raised by the Revenue are dismissed

ITA 2413/MUM/2023[2016-17]Status: DisposedITAT Mumbai12 Aug 2024AY 2016-17

Bench: IN THE INCOME TAX APPELLATE TRIBUNAL "I" BENCH, MUMBAI SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER SHRI RAHUL CHAUDHARY (Judicial Member)

paid to non- resident under Section 195 of the Act as the same were chargeable to tax in India in terms of Section 9(1)(vii) of the Act read with either Article 12 or Article 22/23 of the corresponding DTAAs as FTS or Other Income, respectively. Since the Assessee ... Table in paragraph 5 above] it was contended that professional fee were not liable to tax in India in terms of Section 9(1)(vii)(b) of the Act for the reason the same were utilized outside India and/or for earning income from source outside India. [Refer to Note

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax-Circle-16(2), Mumbai

ITA 2412/MUM/2023[2017-18]Status: DisposedITAT Mumbai12 Aug 2024AY 2017-18

paid to non- resident under Section 195 of the Act as the same were chargeable to tax in India in terms of Section 9(1)(vii) of the Act read with either Article 12 or Article 22/23 of the corresponding DTAAs as FTS or Other Income, respectively. Since the Assessee ... Table in paragraph 5 above] it was contended that professional fee were not liable to tax in India in terms of Section 9(1)(vii)(b) of the Act for the reason the same were utilized outside India and/or for earning income from source outside India. [Refer to Note

Kpmg Assurance and Consulting Services LLP, Mumbai vs. Assistant Commissioner of Income Tax -16(2), Mumbai

ITA 2411/MUM/2023[2012-13]Status: DisposedITAT Mumbai12 Aug 2024AY 2012-13

paid to non resident under Section 195 of the Act as the same were chargeable to tax in India in terms of Section 9(1)(vii) of the Act read with either Article 12 or Article 22/23 of the corresponding DTAAs as FTS or Other Income, respectively. Since the Assessee ... Table in paragraph 5 above] it was contended that professional fee were not liable to tax in India in terms of Section 9(1)(vii)(b) of the Act for the reason the same were utilized outside India and/or for earning income from source outside India. [Refer to Note