COMMISSIONER OF INCOME TAX, INTERNATIONAL TAXATION AND THE INCOME TAX OFFICER, INTERNATIONAL TAXATION Vs. SYNOPSYS INDIA PVT. LTD.

JUDGEMENT

(1.) THE revenue is in appeal assailing the order of the Income tax Appellate Tribunal passed in ITA No. 290/Bang/3002 dated 6 -1 -2006.

(2.) AT the time of admission of this appeal the following substantial questions of law has been formulated on 7 -8 -2007 to consider the question of law formulated in I.T.A. No. 265/2006. 1. Whether the Tribunal was correct in holding that the assessee is not liable to deduct TDS in respect of payments made for purchase of software as the same cannot, be treated as income liable to tax in India as Royalty or Scientific Work under Section 9 of the Act read with Double Taxation Avoidance Agreements and treaties. 2. Whether the Tribunal was correct in holding that since the assessee had purchased only a right to use the copyright i.e., the software and not the entire copyright itself, the payment cannot be treated as Royalty as per the Double Taxation Avoidance Agreement and Treaties which is beneficial to the assessee and consequently Section 9 of the Act should not take into consideration.

(3.) WHETHER the assessee. can question the taxability of the recipient in Section 201(1) of the Act proceeding when the assessee has to show only "without good and sufficient reasons failed to deduct and pay tax", which has not been shown in the facts of the present case and non taxability cannot be taken as a sufficient reason, when Section 195(2)(3)(4) of the Act certificate is not. obtained.