Taxation of royalties and interest: India-Germany DTAA treats such income as taxable in India despite exemption for industrial profits. Under the India-Germany Double Taxation Avoidance Agreement, industrial or commercial profits attributable to no permanent establishment in India are generally exempt, while rents, royalties, interest and dividends sourced in India remain taxable unless the DTA provides otherwise. Case law further distinguishes between commercial fees and royalties/technical charges based on substance, limits the circumstances in which supply, supervision or procurement create a permanent establishment, and treats subcontractors as distinct from agents for treaty agency provisions.