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2023 (8) TMI 640 - AT - Income TaxTaxability of foreign income in India - amount received by the assessee from certain entities in India - Royalty/Fee for Included Services (FIS) u/s 9(1)(vi) and Article 12 of India USA DTAA - assessee is a non-resident corporate entity and a tax resident of United States of America (USA) - HELD THAT - As considering the fact that the issue in dispute is squarely covered in favour of the assessee by the decision of Hon ble Supreme Court in case of Engineering Analysis Centre of Excellence Pvt. Ltd. 2021 (3) TMI 138 - SUPREME COURT and various orders of the Tribunal in assessee s own case in past assessment years amounts received from sale/supply of software licences and associated services are not taxable as royalty/FIS. Accordingly, he deleted the addition. Decided in favour of assessee.
Issues involved:
The appeal by the Revenue against the order dated 28.12.2022 passed by the Commissioner of Income Tax (Appeals)-42, Delhi, for assessment year 2017-18. Issue 1: Nature of income received by the assessee from Indian entities The dispute revolved around whether the amount of Rs. 4,10,37,496/- received by the assessee from certain entities in India constitutes royalty/Fee for Included Services (FIS) u/s 9(1)(vi) of the Income-tax Act, 1961 and Article 12 of India-USA Double Taxation Avoidance Agreement (DTAA). The assessee, a non-resident corporate entity and a tax resident of the USA, had entered into agreements with Indian entities for the supply of software products and services. The Assessing Officer treated the amounts received by the assessee as royalty/FIS based on past assessments. However, the assessee claimed the benefit under the India-USA DTAA, arguing that there was no transfer of copyright. The Commissioner (Appeals) noted that similar issues had been decided in favor of the assessee in previous assessment years and deleted the addition. Decision: The Tribunal upheld the decision of the Commissioner (Appeals) based on the precedent set by the Hon'ble Supreme Court and previous Tribunal orders in favor of the assessee. The Tribunal found no reason to interfere with the deletion of the disputed amount, ultimately dismissing the appeal by the Revenue.
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