ADVERTISEMENT
  • About
  • Advertise
  • Privacy & Policy
  • Contact
KBN News - Hyderabad Trending News - News From Hyderabad
ADVERTISEMENT
  • Home
  • Hyderabad News
    • AIMIM News
    • City Crime
    • KBN Exclusive
  • Entertainment
    • Bollywood
    • Hollywood
    • Sports
    • Hyderabad Movies
  • India
    • Crime
    • Politics
  • International News
    • Gulf News
    • World News
  • Videos
No Result
View All Result
  • Home
  • Hyderabad News
    • AIMIM News
    • City Crime
    • KBN Exclusive
  • Entertainment
    • Bollywood
    • Hollywood
    • Sports
    • Hyderabad Movies
  • India
    • Crime
    • Politics
  • International News
    • Gulf News
    • World News
  • Videos
No Result
View All Result
KBN News - Hyderabad Trending News - News From Hyderabad
No Result
View All Result
ADVERTISEMENT
Home India

SC: Amount paid by Indian cos to use foreign software not royalty, can’t be taxed

KBN News by KBN News
March 2, 2021
in India
0
SC: Amount paid by Indian cos to use foreign software not royalty, can’t be taxed
0
SHARES
7
VIEWS
Share on FacebookShare on Twitter

New Delhi, March 2 (IANS) The Supreme Court on Tuesday held that the amount paid by Indian companies for the use of software developed by foreign companies cannot be termed as royalty and does not give rise to any income that is taxable in India.

A bench comprising Justices R.F. Nariman, Hemant Gupta and B.R. Gavai said: “The amounts paid by resident Indian end-users/distributors to non-resident computer software manufacturers/suppliers, as consideration for the resale/use of the computer software through EULAs/distribution agreements, is not the payment of royalty for the use of copyright in the computer software, and that the same does not give rise to any income taxable in India.”

As a result, there is no liability for Indian companies to deduct tax at source in connection with purchase of software from foreign companies.

he top court declined to entertain the Centre’s argument that distribution of copyrighted computer software would constitute the grant of an interest in copyright under section 14(b)(ii) of the Copyright Act, thus necessitating the deduction of tax at source under section 195 of the Income Tax Act.

In its 226-page verdict, the top court said: “There is no obligation on the persons mentioned in Section 195 of the Income Tax Act to deduct tax at source, as the distribution agreements/EULAs in the facts of these cases do not create any interest or right in such distributors/end-users, which would amount to the use of or right to use any copyright.”

The verdict has come on over 80 appeals, which challenged the decisions of various high courts, which ruled that amounts paid for purchase of foreign software amounts to royalty.

Citing the distribution agreement, the top court said it shows that what is granted to the distributor is only a non-exclusive, non-transferable licence to resell computer software, it being expressly stipulated that no copyright in the computer programme is transferred either to the distributor or to the ultimate end-user.

The bench observed that the amount paid by the distributor in India to the foreign, non-resident manufacturer or supplier, is the price of the computer programme as goods, either in a medium which stores the software or in a medium by which the software is embedded in hardware.

“This may be then further resold by the distributor to the end-user in India, with the distributor making a profit on such resale. Importantly, the distributor does not get the right to use the product at all,” added the top court.

The bench said that when it comes to an end-user who is directly sold the computer programme, such end-user can only use it by installing it in the computer hardware owned by the end-user. The top court noted this cannot in any manner reproduce the same for sale or transfer, contrary to the terms imposed by the End User Licence Agreement.

The Karnataka High Court had ruled that the Indian importers were liable for deduction of tax at source, which has been set aside by the top court.

Source: IANS

Tags: #Computer software#India#New Delhi#Royalty
Previous Post

ED questions Trinamool leader over Saradha scam

Next Post

Covid-19 cases continue to decline in Kerala

KBN News

KBN News

Next Post
Covid-19 cases continue to decline in Kerala

Covid-19 cases continue to decline in Kerala

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

KBN Social Media

  • Trending
  • Comments
  • Latest
Hyderabad: Man claiming to be Prophet arrested in old city

Hyderabad: Man claiming to be Prophet arrested in old city

May 1, 2021
Sara Ali Khan: My mother has gone through so much more than I have

Sara Ali Khan: My mother has gone through so much more than I have

March 2, 2021
Neha Kakkar recalls the time she used to be ‘thin’

Neha Kakkar recalls the time she used to be ‘thin’

May 1, 2021
Hyderabad: Rowdy Sheeter Kala Feroz Murdered

Hyderabad: Rowdy Sheeter Kala Feroz Murdered

January 26, 2021
PM launches India’s vaccination drive against COVID-19

PM launches India’s vaccination drive against COVID-19

1
2 weeks before killing, Atiq moved SC for protection in UP police custody

2 weeks before killing, Atiq moved SC for protection in UP police custody

0

Learn About How Payday Loans Can Help You Throughout a Temporary Cash Crisis

0

Free Photo Editor – How to Create Your Dream Image

0
2 weeks before killing, Atiq moved SC for protection in UP police custody

2 weeks before killing, Atiq moved SC for protection in UP police custody

April 16, 2023
Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

April 5, 2023
Tesla remains EV market leader in US with over 50% share

Tesla remains EV market leader in US with over 50% share

April 5, 2023
Hyderabad: Muslim couple file complaint after right-wing ‘harassment’

Hyderabad: Muslim couple file complaint after right-wing ‘harassment’

April 5, 2023

Recent News

2 weeks before killing, Atiq moved SC for protection in UP police custody

2 weeks before killing, Atiq moved SC for protection in UP police custody

April 16, 2023
12
Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

April 5, 2023
19
Tesla remains EV market leader in US with over 50% share

Tesla remains EV market leader in US with over 50% share

April 5, 2023
10
Hyderabad: Muslim couple file complaint after right-wing ‘harassment’

Hyderabad: Muslim couple file complaint after right-wing ‘harassment’

April 5, 2023
27
KBN News – Hyderabad Trending News – News From Hyderabad

KBN News is a popular News Channel made its debut in October 2015 and was rebranded to KBN News on Aug 2, 2017 The vision of the channel is "'BEING TRUE ' -the promise of keeping each individual ahead and informed. KBN News is best defined as a responsible channel with a fair and balanced approach that combines prompt reporting with insightful analysis of news and current affairs.

Follow Us

Browse by Category

  • AIMIM News
  • Bollywood
  • City Crime
  • Crime
  • Entertainment
  • featured
  • Gulf News
  • Hollywood
  • Hyderabad Movies
  • Hyderabad News
  • India
  • International News
  • KBN Exclusive
  • National news
  • Politics
  • Sports
  • Uncategorized
  • Videos
  • World News

Recent News

2 weeks before killing, Atiq moved SC for protection in UP police custody

2 weeks before killing, Atiq moved SC for protection in UP police custody

April 16, 2023
Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

Never thought BJP govt will give me Padma award; PM proved me wrong, says Ahmed Quadri

April 5, 2023
  • About
  • Advertise
  • Privacy & Policy
  • Contact

© 2021 KBN News - KBN News - Trending news of Hyderabad.

No Result
View All Result

© 2021 KBN News - KBN News - Trending news of Hyderabad.