India - Income Tax Act 2010 - Saarc

S. 9 I.T. ACT, 1961 1.3880[Provided further that nothing contained in this clause shall apply inrelation to so much of the income by way of royalty as consists oflump sum payment made by a person, who is a resident, for thetransfer of all or any rights (including the granting of a licence) inrespect of computer software supplied by a non-resident manufactureralong with a computer or computer-based equipment underany scheme approved under the Policy on Computer SoftwareExport, Software Development and Training, 1986 of the Governmentof India.]Explanation 1.—For the purposes of the 81 [first] proviso, an agreementmade on or after the 1st day of April, 1976, shall be deemed tohave been made before that date if the agreement is made inaccordance with proposals approved by the Central Governmentbefore that date; so, however, that, where the recipient of the incomeby way of royalty is a foreign company, the agreement shall not bedeemed to have been made before that date unless, before the expiryof the time allowed under sub-section (1) or sub-section (2) of section139 (whether fixed originally or on extension) for furnishing thereturn of income for the assessment year commencing on the 1st dayof April, 1977, or the assessment year in respect of which such incomefirst becomes chargeable to tax under this Act, whichever assessmentyear is later, the company exercises an option by furnishing adeclaration in writing to the 82 [Assessing] Officer (such option beingfinal for that assessment year and for every subsequent assessmentyear) that the agreement may be regarded as an agreement madebefore the 1st day of April, 1976.Explanation 2.—For the purposes of this clause, “royalty” meansconsideration (including any lump sum consideration but excludingany consideration which would be the income of the recipientchargeable under the head “Capital gains”) for—(i) the transfer of all or any rights (including the granting of alicence) in respect of a patent, invention, model, design, secretformula or process or trade mark or similar property ;(ii) the imparting of any information concerning the working of, orthe use of, a patent, invention, model, design, secret formula orprocess or trade mark or similar property ;(iii) the use of any patent, invention, model, design, secret formula orprocess or trade mark or similar property ;(iv) the imparting of any information concerning technical,industrial, commercial or scientific knowledge, experience orskill ;80. Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991.81. Substituted for “foregoing”, ibid.82. Substituted for “Income-tax” by the Direct Tax Laws (Amendment) Act, 1987, w.e.f.1-4-1988.