Case Law Details
Trimble Solutions Corporation Vs DCIT (ITAT Mumbai)
1. This appeal, filed by the assessee, calls into question the correctness of the order dated 19th June 2019 passed by the Assessing Officer under section 143(3) r.w.s. 144C(13) of the Income Tax Act, 1961, for the assessment year 20 16-17.
2. Grievances raised by the appellant are as follows:
Ground no. 1: Income from cloud hosting services is erroneously held as royalty within the meaning of explanation 2 to section 9(l)(vi) of the Income Tax Act, 1961 (the Act) as well as Article 12(3)(b) of the India – US tax treaty
1.1. On the facts and circumstances of the case and in law, the learned AO, pursuant to the directions of the Hon’ble DRP erred in holding that cloud hosting system is combination of hardware, software and networking elements that constitutes industrial / commercial / scientific equipment and the income of INR 6,23,14,703 earned by the Appellant from cloud hosting services is for use of or right to use industrial / commercial / scientific equipment which would constitute royalty under section 9(1)(vi) of the Act.
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