2017 (4) TMI 1504

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....tion) in ITA 4/2017 CM APPL 708/2017 (exemption) in ITA 6/2017 2. Allowed, subject to all just exceptions. ITA Nos. 909/2015, 28/2016, 861/2016, 944/2016, 4/2017, 6/2017 3. These are appeals under Section 260A of the Income Tax Act, 1961 ("Act‟) by the Revenue against the impugned Order dated 18th May 2015 passed by the Income Tax Appellate Tribunal ("ITAT‟) in ITA Nos. 04/Del/2012, 1124/Del/2014, 1125/Del/2014, 221/Del/2013, 720/Del/2013, and 82/Del/2011 for the Assessment Years ("AYs‟) 2008-09, 2004-05, 2010-11, 2003-04, 2009-10 and 2007-08 respectively. 4. While admitting these appeals on 16th January, 2017, this Court passed the following order: "Admit. The following questions of law arise for consideration: ....

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....ses as the Indo-US DTAA. Relying on the decision of this Court in Director of Income Tax v. Ericsson AB (2012) 343 ITR 470, this Court in ZTE Corporation (supra) held in para 22 as under: "22. In the present case, the facts are closely similar to Ericson. The supplies made (of the software) enabled the use of the hardware sold. It was not disputed that without the software, hardware use was not possible. The mere fact that separate invoicing was done for purchase and other transactions did not imply that it was royalty payment. In such cases, the nomenclature (of license or some other fee) is indeterminate of the true nature. Nor is the circumstance that updates of the software are routinely given to the Assessee‟s customers. These ....

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....r the Jurisdiction of the Hon'ble Delhi High Court. 42. In view of the above, respectfully following the decision of Hon'ble Jurisdictional High Court in the case of Ericsson A.B. (supra) and Infrasoft Ltd. (supra), we hold that the consideration received by the Assessee for supply of product along with license of software to End user is not royalty under Article 12 of the Tax Treaty. Even where the software is separately licensed without supply of hardware to the end users (i.e. eight out of 63 customers), we are of the view that the terms. of license agreement is similar to the facts of Infrasoft Ltd' (supra). Accordingly, we- hold' that there was no transfer of any right in respect of copyright by the Assessee and it wa....