In absence of transfer, payment for use of software cannot be treated as Royalty

Shell India Markets Private Limited Vs ITO (ITAT Mumbai) Assessee’s claim that it has acquired mere user right in copyrighted article and thus the payments in question are not to be considered as royalty, is not tenable. As there is transfer of copyright right between the assessee and the SIBV, the payments made by the assessee to the SJBV for use of license fall under the purview of 9( l)(vi) of the Income Tax Act, as royalty payment, and hence chargeable to tax in India. Ld. Counsel of the assessee submitted that issue is squarely covered by the decision of the Hon’ble Supreme Court ...