The Tax Publishers021 TaxPub(DT) 5897 (Del-Trib) : (2022) 094 ITR (Trib) 0707 GE Intelligent Platforms Asia Pacific (P) Ltd. v. ACIT In Favour of Assessee, Del-Trib, ITA No. 630/DEL/2017 & ITA No. 5814/DEL/2017, 01-Jul-2021

INCOME TAX ACT, 1961

Section 9(1)(vi) Section 90

A non-exclusive, non-transferable licence, merely enabling the use of a copyrighted product, was in the nature of restrictive conditions which were ancillary to such use, and could not be construed as a licence to enjoy all or any of the enumerated rights.In the copyrighted article, i.e.,software. Therefore, amounts paid by resident Indian end-users distributors to assessee as consideration or the resale/use of computer software through EULAs/distribution agreements, was not the payment of royalty for use of copyright in the computer softwre, and same did not give rise to any income taxable in India.

Income deemed to accrue or arise in India - Under section 9(1)(vi) - Royalty - Consideration towards offshore supply of standardized shrink wrapped software

Assessee based at Singapore received consideration towards offshore supply of standardized shrink wrapped software. AO taxed the same as royalty in terms of section 9(1)(vi)read with article 12 of the India Singapore DTAA. AO taxed the same as royalty in terms of section 9(1)(vi) read with article 12 of the India Singapore DTAA.Held: A non-exclusive, non-transferable licence, merely enabling the use of a copyrighted product, was in the nature of restrictive conditions which were ancillary to such use, and could not be construed as a licence to enjoy all or any of the enumerated rights.In the copyrighted article, i.e.,software. Therefore, amounts paid by resident Indian end-users distributors to assessee as consideration or the resale/use of computer software through EULAs/distribution agreements, was not the payment of royalty for use of copyright in the computer softwre, and same did not give rise to any income taxable in India.

Followed:Engineering Analysis Centre of Excellence (P) Ltd in a Bench of appeal in Civil Appeal Nos. 8733 -- 8734 of 2018 : 2021 TaxPub(DT) 1208 (SC) & Ors.

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2013-14 & 2014-15



IN THE ITAT, DELHI BENCH

N.K. BILLAIYA, A.M., & SUDHANSHU SRIVASTAVA, J.M.

GE Intelligent Platforms Asia Pacific (P) Ltd. v. ACIT

ITA No. 630/DEL/2017 & ITA No. 5814/DEL/2017

1 July, 2021

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