Held that the amount paid by assessee Indian end user/distributors to non-resident computer software manufacturers/suppliers, as consideration for resale/use of computer software through EULA/distribution agreement, is not payment of royalty for use of copyright in computer software and, thus, same does not give rise to any income taxable in India. Not liable to deduct tax at source. (AY. 2009-10)
Bain & Company India (P.) Ltd. v. ITO (TDS) (2022) 193 ITD 787 (Delhi)(Trib.)
S. 195 : Deduction at source-Non-resident-Income deemed to arise in India-Computer software through EULA/distribution agreement, is not payment of royalty for use of copyright in computer software and, thus, same does not give rise to any income taxable in India-Not liable to deduct tax at source-DTAA-India-USA. [S. 9(1)(vi), Copy Right Act, 1957, S. 14(a), 14(b), 52(1)(aa), Art. 12(4)(b)]