Whether the following payment comes within the scope of the definition of 'Royalty' u/s 9(1)(vi):
An Indian company purchases 'advertising space' in its foreign AE's website (and sells the same to 3rd party advertisers) and makes payments for the same to foreign AE without making TDS for the reason that the transaction does not come under the purview of the 'royalty' definition?
Pl clarify whether the assessee's action is correct. If so, what is the deciding judicial precedent, if any?
Royalty is paid in cases here there is agreement between parties to use particular registered item for particular time limit.
In above case this is not the scene. Assessee has purchased space so no royalty needs to be paid and since its purchase sale transaction so qustion of TDS does not come in picture
CAclubindia
