https://www.taxtmi.com/caselaws?id=204100 Consideration for software supplied under a restrictive end-user licence was analysed under section 9(1)(vi) of the Income-tax Act and Article 12(3) of the India-USA DTAA. Because the licensee obtained only a non-exclusive, non-transferable right to use the program internally, with no right to copy, modify, sublicense, reverse engineer, or commercially exploit it, the payment was treated as consideration for a copyrighted article and not for any transfer of copyright rights. On that basis, it was not royalty; the foreign recipients' income was characterised as business income not taxable in India in the absence of a permanent establishment, and no tax was required to be deducted at source under section 195. en-us Fri, 29 Oct 2010 00:00:00 +0530 Sat, 25 Aug 2012 11:35:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=204100 Consideration for software supplied under a restrictive end-user licence was analysed under section 9(1)(vi) of the Income-tax Act and Article 12(3) of the India-USA DTAA. Because the licensee obtained only a non-exclusive, non-transferable right to use the program internally, with no right to copy, modify, sublicense, reverse engineer, or commercially exploit it, the payment was treated as consideration for a copyrighted article and not for any transfer of copyright rights. On that basis, it was not royalty; the foreign recipients' income was characterised as business income not taxable in India in the absence of a permanent establishment, and no tax was required to be deducted at source under section 195. Case-Laws Income Tax Fri, 29 Oct 2010 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=204100