Software Licensing to L&T for Vizag Project Not Taxable as Royalty, Says ITAT; Ownership and Modification Rights Retained.

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....The assessee, a non-resident company incorporated in Singapore without a permanent establishment in India, received income from licensing of software to M/s. L&T Ltd. for the Vizag Smart City project. The End User License Agreement (EULA) clearly stated that no title or ownership of the software or its documentation was transferred to the buyer, and the ownership and modification rights remained with the assessee. Based on the facts and circumstances, the supply of software by the assessee to M/s. L&T Ltd. cannot be treated as royalty u/s 9(1)(vi) of the Income Tax Act or Article 12 of the India-Singapore DTAA. The decision relies on the Supreme Court's ruling in Engineering Analysis and Centre of Excellence Pvt. Ltd., as well as the Delhi .........