Document Fragment View

Matching Fragments

20. Before proceeding on merits, we will look at the relevant provisions of section 10AA, which reads as below:-
"10AA. **** (7) For the purposes of sub-section (1), the profits derived from the export of articles or things or services (including computer software) shall be the amount which bears to the profits of the business of the undertaking, being the Unit, the same proportion as the export turnover in respect of such articles or things or services bears to the total turnover of the business carried on by the undertaking: Provided that the provisions of this sub-section as amended by section 6 of the Finance (No. 2) Act, 2009 (33 of 2009) shall have effect for the assessment year beginning on the 1st day of April, 2006 and subsequent assessment years."
DASSAULT SYSTEMS K. K., In re [70101 32 ITR 175 (AAR), GEOQUEST SSTEMS B. V., In re 120101 327 ITR 1 (AAR), DIT v. ERICSSON A. B. 120121 343 ITR 470 (Delhi), DIT v. Nokia NETWORKS OY [2013] 358 ITR 259 (Delhi), D1T V. INFRASOFT LTD. [2014] 3 ITR-OL 333 (Delhi) and CIT v. Z'I'E CORPORATION [2017] 392 ITR 80 (Delhi) approved.
STATE BANK OF INDIA V. COLLECTOR OF CUSTOMS (2000) 1 SCC 727 relied on.
Royalty, under section 90)(vi) of the Act, means the transfer of all or any rights, including the g-ranting of a licence, in respect of any copyright in P a g e | 26 ITA No. 2413 & 2477/Mum/2021 TCS Ltd. Vs. DCIT LTU-1 a literary work. Under article 3(2) of the Double Taxation Avoidance Agreement between India and Singapore, the definition of the term "royalties", shall have the meaning assigned to it by the DTAA, meaning thereby that the expression "royalty, when occurring in section 9 of the Act, has to be construed with reference to article 12 of the DTAA. This position is also clarified by CBDT Circular No. 333 dated April 2, 19822 . Thus, by virtue of article 12(3) of the DTAA, royalties are payments of any kind received as consideration for "the use of; or the right to use, any copyright" of a literary work, which includes a computer programme or software.