TaxTMI 
TaxTMI 
2012 (10) TMI 980
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....e assessee is with regard to the issue as to whether the payments received by the assessee on sale & marketing of software licence to the customers is 'royalty' within the meaning of section 9(1)(v) of the Income-tax Act, 1961 [hereinafter referred to as "the Act" in short"] as well as Article 12 of the DTAA between India and Ireland. 4. The assessee is a non-resident incorporated under the laws of Ireland. The assessee is engaged in the business of sale & marketing of software licences. During the previous year, the assessee sold and marketed software licences to customers who are mainly software companies in India. According to the assessee, the software sold in India were shrink-wrapped software and were like any other goods. The sale o....
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....ftware or documentation in whole or in part. Thus, licence is granted for making use of the copyright in respect of shrink wrapped software/off the- shelf software under the respective agreements which authorizes the end-user i.e., customer to make use of the copyright in the said software. Hence, the contention of the assessee that there is no transfer of copyright or any part thereof under the agreements entered into by the assessee with the non-resident was held to be not acceptable. The Hon'ble Court further held that for the licence granted to the assessee to make copy of the software into the hard disk of the designated computer and to take a copy for back up purposes, the end-user has no other right and the said back up would hav....
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....at interest u/s. 234B of the Act can be levied only if there is any default in making payment of advance tax. The method of determining the advance tax payable is laid down in section 209 of the Act. Under section 209(1)(d) of the Act, income tax has to be calculated after reducing the amount of income tax which would be deductible or collectible at source. Since u/s. 195 of the Act, payments to the assessee are tax deductible at source by the payer, income tax so deductible will have to be reduced while computing advance tax payable u/s. 209 of the Act. If so reduced, there would be no liability on the part of the assessee to pay any advance tax and consequently there would be no levy of interest u/s. 234B of the Act. The assessee in suppo....
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....a default in making the payment of advance tax, the consequence which is to follow is that the interest becomes payable under s. 234B. But in the instant case, the provisions of s. 234B would not be attracted at all. The scheme of the Act in respect of non residents is clear. Sec. 195 puts an obligation on the payer, i.e. any person responsible for paying to a non-resident, to deduct income-tax at source at the rates in force from such payments excluding those incomes which are chargeable under the head 'Salaries'. Therefore, the entire tax is to be deducted at source which is payable on such payments made by the payer to the non-resident. Sec. 201 lays down the consequences of failure to deduct or pay. These consequences include no....