TaxTMI 
TaxTMI 
2026 (8) TMI 1251
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....holding that the receipts from Indian customers are chargeable to tax as royalty in terms of Article 12(3) of India-US Double Tax Avoidance Agreement ("DTAA") and under Section 9(1)(vi) of the Act. 2.1 That on the facts and in the circumstances of the case and in law, the Ld. AO/ DRP have erred in holding that the subscription charges received under Chemical Abstract Service (CAS) division and Publications (PUBS) division would be chargeable to tax in India under India-US DTAA being received for use of information concerning industrial, commercial or scientific experience and / or for use of industrial, commercial or scientific equipment. 2.2 That on the facts and circumstances of the case and in law, the Ld. AO/ DRP have erred in not following the principle of consistency, while holding that subscription charges received by the appellant are chargeable to tax under the India-US DTAA as being received for use of industrial, commercial or scientific eguipment, not appreciating that the same was not held by the Ld. AO/ DRP in the initial years where the Appellant's matters were first picked up for scrutiny. 2.3 That on the facts and circumstances of the....
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.... the Ld. AO that the assessee has made submissions regarding, why the income from journals subscription and CAS subscription to database should not be treated as income from royalty or FIS (Fees for included Services). The assessee has furnished elaborate submission qua the following services: * Fee for providing access to online chemistry databases (CAS division) * Subscription revenue from sale of online journals (PUBS division) * Fee for memberships (M&SA division) 4. After lengthy deliberation on the issue, it is submitted by the assessee that the issue is covered by the decision of Tribunal in assessee's own case and also many other decisions which were relied upon by the assessee. However, the Ld. AO was not convinced with the submissions of the assessee and accordingly has issued a draft assessment u/s 144C(1) of the Act on 28.03.2025 by determining the assessed income of assessee at Rs.151,17,92,545/-. 5. The assessee, being aggrieved had raised an objection before the Ld. Dispute Resolution Panel (in short, "the DRP") against the aforesaid draft assessment order. The DRP has pass 21.11.2025, wherein the objections of assessee were considere....
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....cision of ITAT having rendered under similar facts, circumstances, on similar grounds of appeal, wherein the issue was decided by the ITAT relying upon the decision of Co-ordinate Bench of Tribunal in ITA No.6811/Mum/2017 for AY 2014-15 and ITA No.1160/Mum/2024 for AY 2013-14 in favour of the assessee. The finding of ITAT in assessee's own case for AY 2022-23 are reproduced hereunder for the sake of completeness: "2. We have heard rival submissions of the parties and perused the relevant materials on record. In the grounds raised, the assessee is aggrieved with the finding of the Id Assessing Officer in holding that the subscription charges received under chemical abstract service division and publication division was taxable as royalty' under domestic law as well as under India US DTAA, being received for use of information concerning industrial, commercial or scientific experience and/or for use of industrial, commercial or scientific equipment. Before us, the Ld. counsel for the assessee submitted that identical issue has been decided by the Co-ordinate Bench of the Tribunal in ITA No. 6811/Mum/2017 for assessment year 2014-15 and ITA No. 1160/Mum/2024 for assessmen....
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....f someone purchases a book, then the consideration paid is not for the use of the copyright in the book/ article. The purchaser of a book does not acquire the right to make multiple copies for re-sale or to make derivative works of the book, i.e., the purchaser of a book does not obtain the copyright in the book. Similarly, the purchaser of the assessee's journals, articles or database access does not have the right to make copies for re-sale and does not have the right to make derivative works. In short, the purchaser has not acquired the copyright of the article or of the database. What the buyer gets is a copyrighted product, and accordingly the consideration paid is not royalty, but for purchase of a product. In the instant case too, what is acquired by the customer is a copyrighted article, copyrights of which continue to lie with assessee for all purposes. It is a well settled law that copyrighted article is different from a copyright, and that consideration for the former, ie. a copyrighted article does not qualify as royalties. 19. Thus, the principles noted by us in the earlier part of this order in the context of the income earned by way of CAS fee are square....