| |
| The Tax Publishers2019 TaxPub(DT) 8318 (Chen-Trib) INCOME TAX ACT, 1961
Section 9
Grant of non-exclusive, non-transferable license in computer software with no right to sub-lease or transfer would fall within purview of 'Royalty' both under India Italy DTAA as well as under section 9(1)(vi) and was chargeable to income-tax.
|
Income deemed to accrue or arise in India - Chargeability - Grant of non-exclusive, non-transferable license in computer software with no right to sub-lease or transfer whether 'royalty' -
Assessee-company was engaged in business of engineering and procurement assistance services. It purchased certain software licenses from Saipem SPA, Italy, which were used for providing services to customers for various support functions in accounting, reporting, etc. AO made disallowance of aforesaid payment by invoking provisions of section 40(a)(i). AO alleged that assessee did not deduct tax at source as per section 195. Held: Assessee made payments to Saipem SPA, Italy towards software licenses/purchase of software, a personal, non-exclusive, non-transferable license with a right to make unlimited copies, however, said software can only be used for internal purposes. Grant of non-exclusive non-transferable license in computer software with no right to sub-lease or transfer would fall within purview of 'Royalty' both under DTAA as well under section 9(1)(vi) and was chargeable to income-tax.
REFERRED :
FAVOUR : Against the assessee
A.Y. : 2014-15
IN THE ITAT CHENNAI 'C' BENCH
 SUBSCRIBE FOR FULL CONTENT
|