How to reduce research time from 60 minutes to 6 minutes by using Taxmann’s ‘Case Finder’ tool

Background

A customer has asked us a query about the withholding of tax from the subscription charges payable to Shutterstock. Shutterstock is a USA based company which provides copyright images and other contents by charging subscription fees. To get an answer, we needed to determine if the payment of subscription charges is a royalty or a business income. In the absence of clear guidance in the Income-tax Act or DTAAs, such evaluation could be possible only based on courts’ pronouncements. Thus, I visited the International Tax module of taxmann.com to find the relevant case laws on this aspect.

Research with normal search function

I searched ‘subscription fee’ in International Tax case laws and got 144 records. I had to open every case and read the complete headnote to ensure that my research is not incomplete. After spending 30-45 minutes to open a case law and reading their head-notes, I shortlisted 4-5 cases. In the next 15-20 minutes, I copied the digest in a word file and extracted the relevant content to be included in my response to the query.

Research using ‘Case Finder’ tool

I searched ‘Subscription fee’ in the Case Finder tool and got 13 records (covering all cases which have been either tagged with the parameter of ‘subscription fees’ or which have these words in the quick-digest). Now, instead of reading the full headnotes, I quickly glanced the quick-digest of 13 records.

I don’t need to open every case law as the digests of relevant cases are given on the same window and I just need to scroll down the page. It cuts down the time consumed in selecting and opening a record. The window shows the relevant tags of all record and also highlights the matching words, which helps in quick glancing of all records. This helps the user to instantly decide if a particular case is relevant or not as per his research requirement.

Using this process, I selected two cases in 5 mins which were relevant for the query. The 4^th result is Wipro Ltd. [2011] 16 taxmann.com 275 (Karnataka) wherein the Karnataka High Court held that payment made by an assessee to a non-resident concern for the licence to use database maintained by that concern is to be treated as royalty.

Another record was Ahmedabad Tribunal’s order in the case of DCIT v. Welspun Corporation Ltd. [2017] 77 taxmann.com 165 that payments of subscription fees for the specialized database containing copyright material were for use of copyrighted material rather than for use of copyright, they could not be treated as royalty payments.

Taxmann’s Case Finder tool saved my valuable 54 minutes as I could complete my research in just 5-6 minutes.

Taxmann’s International tax Case Finder tool

Taxmann’s Transfer Pricing Case Finder tool