Article a dozen of one’s Asia-U . s . DTAA
S. 9: Money – Considered so you’re able to accrue otherwise arise in the Asia (Royalties/costs to own technical attributes – Remittance) – payment built to Us established organization toward rates compensation about what activities got equal to fool around with and not paid off amount to royalty, levy of interest u/s. 201(1A) are unjustified.
The brand new AO introduced buy you/s. 201(1) and you may kept one to remittance from assessee so you’re able to GTRC was absolutely nothing however, royalty depending on specifications off s.9 (1)(vi) plus regards to blog post twelve away from DTAA ranging from Asia and United states of america.
For this reason, levy of interest u/s. 201(1A) wasn’t justified.(roentgen.w.s. 195 and you can 201 and you can blog post twelve of DTAA anywhere between India and USA)(AYrs : 2012-thirteen and you can 2013-14)
S. 9(1)(vi) : Income considered so you’re able to accrue or occur for the Asia – Royalty – Money out-of income away from application licenses kept regarding the character regarding Royalty money – ITAT held one income are received for sale away from software/licenses and not to have separating that have copyright of your application – thus it is not Royalty income since discussed less than Post 12 of your DTAA.
The latest AO wanted to evaluate organization money earned by the Assessee available of software/licenses once the Royalty earnings you/s nine(1)(vi) of your Operate roentgen.w. Toward attract, the brand new Tribunal stored the deal is actually offered of permit/app, where the prevent-representative will have usage of and employ brand new authorized program equipment and not to have parting with copyright the program. Since it is not Royalty, the money is in the character out of business earnings of your own Assessee. To have company winnings of a non-resident organization are taxable for the India under Post eight off the Asia-United states of america DTAA, it is necessary one such as for instance foreign organization need a long-term place (“PE”) into the India in terms of Blog post 5 of said DTAA. (AY 2009-10 & 2014-15)
S. eleven : Property kept getting charity intentions – leasing earnings based on letting away facility so you’re able to musicians for teaching Indian traditional musical happens when you look at the ambit regarding “education” – Assessee was eligible to exemption you/s 11 comprehend that have S. 2(15)
The newest Tribunal observed one to Assessee try an altruistic faith engaged in exercises Indian Traditional Musical and this drops in the realm of “education”
The latest assessee is actually an altruistic trust registered u/s 12A and you may 80G of your Work. About related AY, this new assessee-trust obtained business charges out of Rs 16,72,197/- off some designers. https://besthookupwebsites.org/tr/apex-inceleme/ The latest AO kept that business try rented toward writers and singers with an intention to make earnings about shield away from charity issues and you may taxed such as for instance studio charges because the business earnings of one’s Assessee significantly less than S.11(4A) of the Operate. CIT(A) kept the transaction of your own AO. Since the faith was engaged in studies, the new proviso so you’re able to point dos(15) cannot incorporate while the clarified by CBDT Circular Zero. eleven old though it involves this new holding a commercial interest. The new tribunal detailed the historical past of one’s Faith observed that invoices regarding Rs. sixteen,72,197/- is located at a great sponsored costs and affairs of one’s studios are continuing in order to achieve an element of the target away from brand new Believe and cannot be construed once the a corporate. Dependency could have been placed on the newest judgement out of Madras Large Judge when it comes to Sri Thyaga Brahma Gana Sabha 188 ITR 160 (Mad) courtroom. (AY 2010-11 & 2012-13)
S. 12A: Charitable or religious trust – Registration from (Cancellation) – Assessee unwilling to avail ‘benefit’ away from registration ‘obtained’ u/s. 12A cannot be destined to, of the action out of otherwise from the inaction away from cash bodies, continue with said membership
