Karnataka High Court
The Commissioner Of Income Tax vs M/S Sonata Information Technology Ltd on 20 March, 2012
Bench: N.Kumar, Ravi Malimath
1 ITA 946/207. IN THE HIGH COURT OF KARNATAKA, BAR GALORE | DATED THIS THE 20™ DAY OF NARCE 2019 PRESENT: THE HON'BLE MR. JUSTICE R. KUMAR THE sowmssiwn Joann snvwianaes a he Commissioner of Income tax ~ International Taxation, | os 2. _ The Income tax Officer, Or KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA MIOMM GYUURS Ur RARINATARA Fingtr warns _. (Ipternational Taxation), -- Ward ~ 192), - Rastrothana Building, Nrupathunga Road, Bangalore. . Appellants (Sri.K.V.Aravind, Adv. for . Sri. M.V. Seshachala, Adv.) en JURT OF KARNATAKAHIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT 2 ITA 946/2007 AND: M/s. Sonata Information Technology Limited, . No.193, 1* Floor, R.V.Road, Basavanagudi, Bangalore. ee % we Respondent (By Smt.Vani.H., Adv.) This ITA ie Sled under Section 260-A of I.T Act, 1961 arising out of order dated 10.08.2007 passed in LT.A No.968 to 982/BANG/ 2007, for the assessment year 2006-2007, praying that thie Hon'ble Court may be pleased to formulate 'the substantial queations of law stated therein, etc. This YEA coming on for hearing, this day, | NKUMAR, J, delivered the following: ORDER
| - The Revenue has preferred this appeal oS - challenging the orders passed by the Income Tax _ Dibunal, which has held that the consideration paid by the assessee do not fall within the mischief of foyalty' as defined under sub-clause [vj] to We "OF KARNATAKA HIGH COURT GF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT 3 ITA 946/207 Explanation 2 to Clause [vi] of section ann) of the a Income-tax Act 1961.
2. In fact, the substantial question of law which arises for consideration in this appeal arose for consideration before. thie court in | two appeals, fratly, in the case of 'CGMMISSONER OF INCOME TAX AND ANOTHER - -¥8- SYNCASIS INTERNATIONAL OLD LTD.,' in ITA Nos. ll to 15/2008 dooided on 3.8.2010 where the substantial question. of law was as under:
| " Wissther the consideration paid by the : "Indian customers or end users to the assessee =a foreign supplier, for tranafer of the right to use fre software/computer programme in respect of the copyrights falis within the ee of 'royalty' as defined under sub- clause fu} to Explanation 2 to Clause [vi] of section 91} of the Act." .
We JURT OF KARNATAKAHIGH COURT GF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT 4 ITA 946/2007
3. Again in the case of 'COMBETSSIONER ov :
INCOME TAX AND ANOTHER -va- SAMSTING BUNCTRNICS: :
PRIVATES LIMITED' in ITA No. 2808/ 2008 and connected matters decided on 1. 10. 201 1,. 'the substantial question of law framed is a2 vender:
"The qucation which the Pig Court wi answer. is --_--. whether on facta and croanstances: of the case, the ITAT was justified in hukding that the amount{e] paid by the appellants} to. the foreign software suppliers was not 'royalty' and that the sane 7" did not give rise to any 'income' taxable in _ India and, therefore, the appellant{s} was not | Hable to deduct any tax at source?*
4. | In both the oases, it was held that oa consideration paid by the Indian customers or end os se users to the assessee -- a foreign supplier, for transfer of the right to use the software/computer programme in reapect of the copyrights falle within the mischief Hy OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH COURT OF KARNATAKA HIGH CQURT OF KARNATAKA HIGH COUR' 5 ITA 946/2007 of 'royalty' as defined under eub-cleuse [to : _ Explanation 2 to Clause fyi] of section 9[t] of the Income Tax Act, 1961. SSR
5. In view of the afbresaid law declared by this court, the substantial queations of law framed in this case are also answered in fevour of the revenue and against the aenoeuce. |
6. Ordered accordingly.
-- r _ Appeal is allowed.
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JUDGE Sd/-
JUDGE