Dismissing the appeal of the assessee the Tribunal held that ; payment of SAP charges made to Associated enterprise for use of licensed software was correctly regarded as royalty by the lower authorities according to article 12 of the DTAA. In view of this, the above payment made by the assessee to its holding company is chargeable to tax as royalty according to Act as well as according to the double taxation avoidance agreement. Therefore, on such payment assessee should have deducted tax at source under the provisions of S.195 at the beneficial rate of 10 per cent provided under the double taxation avoidance agreement. In view of this, the order passed by the Assessing Officer is correctly confirmed by the CIT(A) ( AY. 2000-01 to 2006 -07)