Payments for using copyrighted software are classified as royalties in India but are not taxable under current law.

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....Income accrued in India - royalty and Fees for Technical Services - literary work - The grant of license to use the software cannot be construed as granting a right to utilize the copyright embedded in the software. Therefore we are of the considered view that the payments received by the assessee are towards the use of copy righted software and not towards acquisition of copy right or right to use the copy right. - Not taxable - AT....