India - Royalty

Article 12. Royalties, fees for technical services and payments for the use of equipment

1. Royalties, fees for technical services and payments for the use of equipment arising in one of the States and paid to a resident of
the other State may be taxed in that other State.

2. However, such royalties, fees and payments may also be taxed in the State in which they arise and according to the laws of that
State, hut if the recipient is the beneficial owner of these categories of income the tax so charged shall not exceed 20 per cent of the
gross amount of the royalties, of the fees and payments.

3. The competent authorities of the States shall by mutual agreement settle the mode of application of paragraph 2.

4. The term "royalties" as used in this Article means payments of any kind received as a consideration for the use of, or the right to
use, any copyright of literary, artistic or scientific work including motion picture films and works on Film or videotape for use in
connection with television, any patent, trade mark, design or model, plan, secret formula or process or for information concerning
industrial, commercial or scientific experience.

5. The term "fees for technical services" as used in this Article means payments of any kind to any person, other than payments to
an employee of the person making the payments and to any individual for independent personal services mentioned in Article 14, in
consideration for services of a managerial, technical or consultancy nature.

6. The term "payments for the use of equipment" as used in this Article means payments of any kind received as a consideration for
the use of, or the right to use, industrial, commercial or scientific equipment.

7. The provisions of paragraphs 1 and 2 shall not apply if the beneficial owner of the royalties, fees for technical services or the
payments for the use of equipment, being a resident of one of the States, carries on business in the other State in which the royalties,
fees for the technical services or the payments for the use of equipment arise, through a permanent establishment situated therein, or
performs in that other State independent personal services from a fixed base situated therein, and the royalties, fees for technical
services or the payments for the use of equipment are effectively connected with such permanent establishment or fixed base. In
such case the provisions or Article 7 or Article 14, as the case may be, shall apply.

8. Royalties, fees for technical services or payments for the use of equipment shall be deemed to arise in one of the States when the
payer is that State itself, a political subdivision, a local authority or a resident of that State. Where however, the person paying the
royalties, fees for technical services or the payments for the use of equipment, whether he is a resident of one of the States or not,
has in one of the States a permanent establishment or a fixed base in connection with which the contract under which the royalties,
fees for technical services or the payments for the use of equipment are paid was concluded, and such royalties, fees for technical
services or payments for the use of equipment are borne by such permanent establishment of fixed base, then such royalties, fees for
technical services or payments for the use of equipment shall be deemed to arise in the State in which the permanent establishment or
fixed base is situated.

9. Where, by reason of a special relationship between the payer and the beneficial owner or between both of them and some other
person, the amount of the royalties, fees for technical services or the payments for the use of equipment, having regard to the
royalties, technical services or the use of equipment for which they are paid, exceeds the amount which would have been agreed
upon by the payer and the beneficial owner in the absence of such relationship, the provisions of this Article shall apply only to the
last-mentioned amount. In such case, the excess part of the payment shall remain taxable according to the laws of each State, due
regard being had to the other provisions of this Convention.

Protocol:

IV. Ad Articles 10, 11 and 12

1. Where tax has been levied at source in excess of the amount of tax chargeable under the provisions of Articles 10, 11 or 12,
applications for the refund of the excess amount of tax have to be lodged with the competent authority of the State having levied the
tax, within a period of three years after the expiration of the calendar year in which the tax has been levied.

2. If after the signature of this Convention under any Convention or Agreement between India and a third State which is a member
of the OECD India should limit its taxation at source on dividends, interest, royalties, fees for technical services or payments for the
use of equipment to a rate lower or a scope more restricted than the rate or scope provided for in this Convention on the said items
of income, then, as from the date on which the relevant India Convention or Agreement enters into force the same rate or scope as
provided for in that Convention or Agreement on the said items of income shall also apply under this Convention.

V. Ad Article 12

It is understood that in case India applies a levy, not being a levy covered by Article 2, such as the Research and Development Cess,
on payments meant in Article 12, and if after the signature of this Convention under any Convention or Agreement between India
and a third State which is a member of the OECD India should give relief from such levy, directly, by reducing the rate or the scope
of the levy, either in full or in part, or, indirectly, by reducing the rate or the scope of the Indian tax allowed under the Convention or
Agreement in question on payments as meant in Article 12 of this Convention with the levy, either in full or in part, then, as from the
date on which the relevant Indian Convention or Agreement enters into force, such relief as provided for in that Convention or
Agreement shall also apply under this Convention.