Case Law Analysis
|Bombay High Court
Real Income Doctrine | Refunded Royalties Under India-US DTAA Not Taxable as Notional Income : Bombay HC
Bombay High Court holds that only the actual income retained after refunding excess royalties under an Advance Pricing Agreement is taxable under Article 12 of the India-US DTAA. The ruling rejects the Revenue’s attempt to tax notional amounts, reinforcing the real income principle in international taxation and providing relief to multinational enterprises facing transfer pricing adjustments.