Receipts from “Sale of Software” not in nature of “Royalty” as per India-Ireland DTAA

Mentor Graphics Ireland Ltd. Vs ACIT (International Taxation) (ITAT Delhi) Conclusion: Receipts from sale of software cannot be treated as ‘royalty’ under the Double Taxation Avoidance Agreement (DTAA) between India and Ireland as payment had been made by assessee for use of “copyrighted material” rather than for the use of copyright in the computer software programme. Held: Assessee-company incorporated in Ireland was in receipt of certain sum towards “Sale of Software” and “Provision for Support Services” from its Indian Distributors. Amount received by assessee from “Provi...