Subscription Payment received by End user to a non-resident Computer supplier is not royalties: Delhi HC Dismisses Revenue’s Appeal

Delhi HC rules subscription payments to non-resident suppliers are not royalties, dismissing revenue’s appeal and easing tax burdens on tech imports. The Delhi High Court has affirmed that subscription payments made by Indian entities to non-resident suppliers for accessing databases or online platforms do not constitute "royalties" or "fees for technical services" under the Income Tax Act or Double Taxation Avoidance Agreements (DTAAs). The court dismissed the revenue department's appeal, clarifying that mere access to a database does not involve the transfer of copyright or provision of managerial/technical services. This judgment provides significant relief to businesses importing such digital services, reducing their withholding tax obligations.