Domain Name Registration Service is ‘Royalty’ – A far fetched proposition The recent decision of the Delhi bench of Income Tax Appellate Tribunal [2018] 92 Taxmann.com 241 (Delhi-Trib) on domain name registration service, makes interesting reading. Go Daddy, a Non-Resident Entity with accreditation to the Internet Corporation for Assigned Names and Numbers (ICANN) is in the business of granting registration of domain names to Indian entities against payment of certain fee. Along with this service, the Appellant also provides services of web hosting. Go Daddy paid tax on Web Hosting Services treating it as Royalty Income, while it took a stand that domain registration fee is not taxable in India as it was neither in the nature of Royalty nor in the nature of Business Profits owing to absence of any business connection. The department’s stand before the DRP and ITAT was that domain registration service was a. a
You will find posts on interesting issues in domestic taxation and views on important decisions of DTAAs concerning India. Over time, we will cover Trade Laws under the WTO.