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2023 (2) TMI 1303 - HC - Income TaxTaxability of income India - Royalty receipts - income earned from licensing/sale of software - subscription receipts against cloud services offered by the respondent/assessee - Tribunal has ruled that neither income earned from licensing/sale of software products nor subscription fee earned for providing cloud services, could be construed as royalty - revenue, says that the proposed questions are covered by the judgment of Engineering Analysis Centre of Excellence (P.) Ltd. 2021 (3) TMI 138 - SUPREME COURT HELD THAT - We are as informed by Appellant that a review petition has been filed which is pending consideration. Accordingly, the appeal is closed as no substantial question of law arises for our consideration albeit, with the caveat that in case the appellant/revenue were to succeed in the review petition, parties will abide by the decision rendered therein.
Issues involved:
1. Application for condonation of delay in re-filing the appeal. 2. Interpretation of taxability of income from licensing/sale of software products and subscription receipts for cloud services. Issue 1: Application for Condonation of Delay - An application was filed by the appellant/revenue seeking condonation of a 100-day delay in re-filing the appeal. - The respondent/assessee's counsel had no objection to the delay being condoned. - The delay was condoned, and the application was disposed of accordingly. Issue 2: Interpretation of Taxability of Income - The appeal pertained to the Assessment Year 2012-13 and challenged the order of the Income Tax Appellate Tribunal regarding the taxability of income. - The appellant/revenue raised questions regarding the taxability of licensing of software products, computer software, and cloud services. - The Tribunal ruled that the income from licensing/sale of software products and subscription fees for cloud services did not qualify as royalty. - The appellant/revenue cited a Supreme Court judgment in support of their position, with a pending review petition. - The appeal was closed as no substantial question of law was found, but parties were to abide by the decision of the review petition if successful.
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