Allowing the appeal of the assessee the Court held that, payment made to supplying drawings, designs etc, before commencement of production is not royalty hence not liable to deduct tax at source.
Majestic Auto Ltd v CIT ( 2019) 267 Taxman 252 ( P& H) (HC) (Editorial: Order in Dy.CIT v Majestic Auto Ltd (1994) 51 ITD 313 (Chd.) (Trib.) is reversed.)
S. 9(1)(vi) : Income deemed to accrue or arise in India–Royalty– Payment made to supplying drawings, designs etc–Before commencement of production-Not royalty-Not liable to deduct tax at source DTAA-India-Austria. [S. 195]