Section 90 of the Income Tax Act

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.

International tax treaties and conventions are not automatically enforceable in India's domestic law. They require an enabling legislative act or a notification issued by the Union under Section 90 of the Income-tax Act to be given effect and create rights or liabilities.

The Supreme Court lays down principles for deducting tax at source (TDS) under Section 195 on payments to non-residents, including aspects of income deemed taxable in India and the application of Double Taxation Avoidance Agreements (DTAAs) under Section 90.

Income from shares and securities held by banks as stock-in-trade constitutes business income, hence Section 14A disallowance is not attracted. Further, any disallowance under Section 14A cannot exceed the actual amount of exempt income earned by the assessee during the year.

The obligation to deduct tax at source under Section 195 arises only when the payment to a non-resident is a sum chargeable to tax under the Income-tax Act (Sections 4, 5, and 9), considering Sections 90, 91, and applicable DTAA. TDS is not automatically triggered by a mere remittance if the income is not taxable in India.

An act that is otherwise valid in law cannot be treated as non-existent or invalid merely because of an underlying motive to reduce tax liability or a perceived economic detriment to national interest; legitimate tax planning is permissible.

Membership rights and business contracts, as 'business or commercial rights of similar nature' to a license or franchise, qualify as intangible assets eligible for depreciation under Section 32(1)(ii) of the Income-tax Act.

Sections 4 and 5 of the Income Tax Act, which define total income and chargeability, are subject to Section 90, meaning that Double Taxation Avoidance Agreements (DTAAs) override the Act's provisions in case of a conflict.

Foreign Tax Credit (FTC) is allowable even if no tax is paid in India on the corresponding income due to deductions under sections 10A or 10AA, or losses in other units. The scope of income eligible for deduction under Section 10AA includes interest on deposits and realized gains on forward contracts.