High Court of Karnataka · Judgments and reasoned final orders
Commissioner of Income Tax (International Taxation) & Anr. v. M/s Informatica LLC
Income Tax Appeal No. 176 of 2022 ·
Ancillary maintenance and support services accompanying standard software licence sales are not taxable as Royalty or Fees for Technical Services (FTS) / Fees for Included Services (FIS) under Section 9(1)(vi)/(vii) or Article 12 of the India-US DTAA, following Engineering Analysis Centre of Excellence Pvt. Ltd. v. CIT (2021) 432 ITR 471 (SC).
1. FACTS OF THE CASE
The Revenue appealed under Section 260A against the ITAT Bengaluru Bench order for AY 2016-17 holding that receipts earned by M/s Informatica LLC (a US tax resident) from sale of software licences and ancillary support/maintenance services were not taxable as Royalty or FTS/FIS under Section 9(1)(vi)/(vii) or Article 12 of the India-US DTAA.
2. DISCUSSION BY THE COURT
The Division Bench held that the questions raised by the Revenue—both as to the software licence receipts and the ancillary support services—are squarely covered against the Revenue by the Supreme Court judgment in Engineering Analysis Centre of Excellence Pvt. Ltd. v. CIT (2021) 432 ITR 471 (SC) and the coordinate bench decision in the assessee's own case. The Court further noted that the Review Petition preferred by the Revenue before the Supreme Court against Engineering Analysis was dismissed on 11.05.2026.
3. JUDICIAL DECISION
Answering the substantial questions of law in favour of the assessee and against the Revenue, the High Court dismissed the appeal.
4. OUTCOME
Assessee - Revenue appeal dismissed; software licence and ancillary support receipts held non-taxable as Royalty/FTS.
5. AKHB REVIEW POINT
With the Supreme Court's dismissal of the Revenue's review petition in Engineering Analysis on 11.05.2026, both standard software licence fees and inextricably linked ancillary maintenance/support receipts stand conclusively outside Article 12 of the India-US DTAA.
Source and verification
4-page official High Court of Karnataka judgment PDF (20260702_KAHC010418502021.pdf, 195,527 bytes).
Original PDF: 4 pages · SHA-256: ef6a9f7fd0977c092bce059144c968dfc7d25635d90f03bc953a78c74c2c4621
Supplied source-reviewed note retained; original bytes and identity validation checked in this release. Substantive re-review is not claimed for this record.
Applies Sections 9(1)(vi), 9(1)(vii), and 90 of the Income-tax Act, 1961 read with Article 12 of the India-US DTAA for AY 2016-17. Income-tax Act, 2025 equivalence is not verified.
Full 4-page primary judgment PDF text read and verified page-by-page. Follows Engineering Analysis Centre of Excellence Pvt. Ltd. v. CIT (2021) 432 ITR 471 (SC) and records that the Supreme Court dismissed the Revenue's Review Petition on 11.05.2026.
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General research only. Read the complete judgment and verify applicable law and subsequent treatment before reliance.