Post several of your Asia-U . s . DTAA
S. 9: Income – Deemed to accrue otherwise arise for the India nostringsattached com (Royalties/charge to own tech services – Remittance) – percentage made to United states based business to the cost reimbursement on what parties got equivalent straight to have fun with rather than paid off amount to royalty, levy of interest you/s. 201(1A) is unjustified.
The fresh AO passed acquisition you/s. 201(1) and you may held that remittance from assessee to help you GTRC was nothing but royalty according to provisions out of s.9 (1)(vi) as well as in regards to article a dozen away from DTAA ranging from Asia and Us.
Thus, levy interesting you/s. 201(1A) wasn’t warranted.(r.w.s. 195 and you may 201 and you may post a dozen out-of DTAA ranging from Asia and you will USA)(AYrs : 2012-13 and you can 2013-14)
S. 9(1)(vi) : Money considered so you can accrue otherwise arise inside India – Royalty – Income regarding deals from application permit held regarding the nature off Royalty income – ITAT kept that income are obtained discounted off software/license rather than to have parting which have copyright of one’s software – thus this isn’t Royalty income because the defined less than Article 12 of one’s DTAA.
New AO found to assess company earnings acquired from the Assessee for sale regarding app/permit because the Royalty income you/s 9(1)(vi) of your Work r.w. Into the interest, the latest Tribunal kept your deal are available out-of license/application, the spot where the stop-associate will receive usage of and employ brand new authorized applications product and not to own separating with copyright the software program. Because it’s perhaps not Royalty, the income is within the characteristics out of providers winnings of one’s Assessee. To own organization winnings regarding a non-citizen organization become nonexempt within the India less than Article eight away from the fresh new Asia-Us DTAA, it is important you to particularly international organization must have a long-term facilities (“PE”) from inside the India in terms of Article 5 of your own told you DTAA. (AY 2009-ten & 2014-15)
S. eleven : Possessions held getting charity aim – leasing money produced by permitting out facility in order to performers to own exercises Indian traditional songs will come in ambit out of “education” – Assessee was eligible to exception to this rule u/s eleven comprehend which have S. 2(15)
The fresh new Tribunal seen you to Assessee try a charitable believe engaged in practise Indian Traditional Sounds and that drops in realm of “education”
The latest assessee is actually a charitable believe registered you/s 12A and you can 80G of your own Operate. From the related AY, the fresh new assessee-trust gotten facility fees of Rs 16,72,197/- regarding various performers. The latest AO kept your facility was hired into artists with an intention making payouts about secure away from charity facts and you may taxed including facility fees as team money of one’s Assessee not as much as S.11(4A) of your own Operate. CIT(A) upheld the order of AO. Due to the fact believe is actually engaged in studies, the newest proviso to point 2(15) will not pertain as clarified by the CBDT Circular Zero. eleven dated even if it requires the carrying a professional pastime. The latest tribunal noted a brief history of your own Trust noticed your receipts regarding Rs. sixteen,72,197/- are at a great subsidized charges plus the facts of one’s studios are carried on in order to achieve area of the target out-of new Believe and cannot end up being construed once the a corporate. Dependency could have been apply brand new judgement off Madras High Legal when it comes to Sri Thyaga Brahma Gana Sabha 188 ITR 160 (Mad) legal. (AY 2010-11 & 2012-13)
S. 12A: Charity or spiritual believe – Membership from (Cancellation) – Assessee unwilling to get ‘benefit’ off membership ‘obtained’ u/s. 12A can’t be bound to, from the action of otherwise from the inaction out-of revenue bodies, continue told you subscription