TaxTMI 
TaxTMI 
2024 (3) TMI 1069
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....her on the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in holding that receipts earned from providing online database access are not covered within the ambit of Royalty u/s 9(1)(vi) of the Act. 2. Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in holding that receipts earned from providing online database access of journals and books cannot be construed as Royalty under Article 12 of the India US Double Taxation Avoidance Agreement. 3. The appellant craves to add, amend, modify or alter any grounds of appeal at any time or before the hearing of the appeal." 2. Ld. Counsel for the assessee, at the outset, submits that the identical issue has been d....
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....ncome. 7. As per Article 12 of the Tax Treaty, 'Royalty" is defined as under: "10.1.4.1 (a) "payments of any kind received as a consideration for the use of, or the right to use, any copyright of a literary, artistic, or scientific work, including cinematograph films or work on film, tape or other means of reproduction for use in connection with radio or television broadcasting, any patent, trademark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience; and (b) payments of any kind received as consideration for the use of, or the right to use, any industrial, commercial or scientific equipment, other than income, derived by an enterprise of a Contr....
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....ts that allow a payer to use/acquire a right to use copyright in literary, artistic or scientific work are covered within the definition of 'Royalty'. In our considered view, the payments made for acquiring right to use product itself, without allowing any right to use the copy right in the product are not covered with the scope of 'Royalty' which may get covered under the term under Royalty as per the Act." 8. In light of the above, let us now consider the facts of the appellant. 9. The assessee is allowing access to data/information on payment of a fee. Data is available in public domain and the appellant makes some value additions like analysis, indexing, description and appending notes for facilitating easy access. The....
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....nder consideration is for provision of accessing data base of the assessee. Hence the same cannot be considered as royalty under Article 12 of the India USA - DTAA. 13. While taxing the revenue as royalty, the Assessing Officer has relied upon the decision of the AAR in the case of Skillsoft Ireland Limited wherein the AAR has followed the decision of the Hon'ble Karnataka High Court in the case of Synopsis International Ltd. 2112 com 454. 14. The Hon'ble Supreme Court in the case of Engineering Analysis Center of Excellence Pvt Ltd. [2021] 432 ITR 471 has considered the decision of the Hon'ble High Court of Karnataka [supra] at para 103 of its order and at Para 105 has observed as under: 15. The Hon'ble Supreme C....