TaxTMI 
TaxTMI 
2023 (7) TMI 17
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....peal: "1. The order of the Ld. CIT(A) is contrary to the law and facts of the case. 2. The Ld. CIT(A) erred in deleting the disallowance of deduction u/s 40(a)(i) of the Act by relying on the decision of the Hon'ble Madras Court in TCA Nos. 549, 554, 555 & 558/2021 vide order dated 20.12.2021 for A.Y. 2010-11 to 2013-14 And 2015-16 in the assessee's own case, which were disposed of by the Hon'ble High Court on account of low tax effect not on merits. 3 The Ld. CIT(A) ought to have considered the decision of the ITAT in ITA No.1210/Chny/2019 dated 23/12/2019,allowing the issue in favour of the revenue in assessee's own case. 4 The Ld. CIT(A) ought to have considered the decision of the Jurisdiction High Court in the c....
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....ction of tax at source u/s. 195 of the Act. Being aggrieved by the CIT(A) order, the revenue is in appeal before us. 4. At the time of hearing, the Ld. CIT-DR submits that the ld. CIT(A) erred in deleting additions made by the Assessing Officer towards disallowance of software support charges u/s. 40(a)(i) of the Act, for non-deduction of TDS u/s.195 of the Act, without appreciating fact that the Tribunal for the assessment year 2014-15, by following the decision of Hon'ble High Court of Madras in the case of M/s. Zylog Systems Ltd vs ITO in TCA No. 2184 & 2185/2006, dated 23.04.2019 decided the issue in favour of the assessee. The ld. DR, further submits that, although the issue in now covered in favour of the assessee by the decision of ....
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....(supra), upheld the order of the Tribunal in allowing relief to the assessee towards payment made to non-residents for software support charges without deduction of tax at source u/s. 195 of the Act. The relevant findings of the Hon'ble High Court of Madras are as under: "2. When these appeals are taken up for hearing today, the learned counsel appearing for both sides jointly submitted that the substantial questions of law raised herein have been decided in favour of the assessee, in the decision of the Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence Private Limited v. Commissioner of Income Tax and another reported in (2021) SCC Online SC 159 which was followed by a Co-ordinate Bench of this Court in T....
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....he substantial which have been raised in this appeal, have been answered in favour of the assessee in the decision of the Hon'ble Supreme Court in the case of Engineering Analysis Centre of Excellence Private Limited v. Commissioner of Income Tax and another reported in (2021) SCC Online SC 159. 5. In the said decision, there were four categories of cases as mentioned below : "4. The appeals before us may be grouped into four categories: i. The first category deals with cases in which computer software is purchased directly by an end-user, resident in India, from a foreign, non resident supplier or manufacturer. ii. The second category of cases deals with resident Indian companies that act as distributors or resellers, by purcha....
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....esident computer software manufacturers/suppliers, as consideration for the resale/use of the computer software through EULAs/distribution agreements, is not the payment of royalty for the use of copyright in the computer software, and that the same does not give rise to any income taxable in India, as a result of which the persons referred to in section 195 of the Income Tax Act were not liable to deduct any TDS under section 195 of the Income Tax Act. The answer to this question will apply to all four categories of cases enumerated by us in paragraph 4 of this judgmnent. 174. The appeals from the impugned judgments of the High Court of Karnataka are allowed, and the aforesaid judgments are set aside. The ruling of the AAR in Citrix Syst....