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2. The first issue in ITA No. 2204/Mum/2014 for AY 2009-10 is as regards to the order of DRP construing the payments received from key of application services ('KPS') providers, International Business Machines ('IBM'), WIPRO and Logica for providing network access to use copyright software in the nature of royalty even though the same is governed by Double Taxation Avoidance Agreement ('DTAA') of India-Netherlands. For this assessee has raised following grounds: -

"Payments received from key application services ('KAS ') for network access etc held to be royalty.

2. erred in construing the payments received from KAS providers i.e. IBM, WIPRO and Logica for providing network access to use copyrighted software to be in nature of royalty, on the alleged ground that payment received by the appellant is consideration for grant ri ght to use various softwares to KAS.

3. Failed to appreciate that the payment received by the appellant company for software access fee is payment for use of copyrighted software and not for any copyright over such software and hence does not constitute royalty under the India -

Netherlands Double Taxation M/s Shell Info rm ation Technology Internati onal BV , A .Ys. 9-10&10-11) Avoidance Agreement ('DTAAA ') and the Act. "

"Payments of any kind received as a consideration for the use, or the right to use, any copyright of literacy, artistic or scientific work including cinematograph films, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience."

12. From the above, it is clear that SITI BV is engaged in providing IT services to Indian entities but does not provide any right to use any copyright of literary, artistic or scientific work including cinematograph films, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific M/s Shell Info rm ation Technology Internati onal BV , A .Ys. 9-10&10-11) experience. Even under the agreements entered into with WIPRO and IBM, SITI BV only provides them access to the software i.e. computer Programme. SITI BV does not provide them the right to use the copyright embedded in the software. In other words, WIPRO, IBM are not permitted to make copies and sell the software. Under the Services Agreements, WIPRO and IBM have been granted the mere under the right in the copyrighted software and not the right of, use of copyright'. Whereas 'use of copyright' encompasses exploitation of the rights embedded in a copyright but a mere user right is a limited right and consideration paid for such user right cannot be regarded as consideration for use of or right to use a copyright. In view of the above, the learned Counsel for the assessee stated that the issue is fully covered by the decision of Hon'ble Delhi High Court in the case of DIT Vs. Guy Carpenter & Co. Ltd, (2012) 20 taxmann.com 807 (Del-HC), wherein India-UK DTAA was under