The Supreme court stated that there will be no TDS that is applied towards the Indian firms toward the amount which is used for foreign software. The appeals for the engineering analysis center of excellence might be grouped for the 4 divisions.
The first category engaged with the event where the foreign software has been bought directly through the end-user resident in India, from a foreign, non-resident supplier or manufacturer.
The second category of the case responds towards resident Indian companies that serve as distributors or resellers, by buying the computer software from foreign, non-resident suppliers or manufacturers and then reselling the same to resident Indian end-users.
The 3rd thing comes from the case in which the distributor seeks to be a foreign nonresident. A vendor who posts buying the software through a foreign non-resident seller resells the same to resident Indian distributors or end-users. The last category consists of the case in which the computer software is affixed to the hardware and is sold as an integrated unit.
It is also important to note that the vide Circular No. 10/2002 on January 9, 2002, the revenue post referring to section 195 of the Income Tax Act 
The 3 benches namely Justices R.F.Nariman, Hemant Gupta, and B.R.Gavai stated that the provided definition of royalties consists inside Article 12 of the DTAAs is been revealed in section 195 of the Income Tax Act so to deduct tax at source, as the distribution agreements /EULAs for the fact of these events did not make any interest or right in these distributions or end-users where the amount to utilized or entitled to use the copyright. The procurement consists of the Income Tax Act (section 9(1)(vi), along with explanations 2 and 4 thereof), where it deals with the royalty for not having advantageous concerns to the taxpayer, who have no application for the case of these problems.
The court states that the amount furnished through the resident Indian end-user to the nonresident computer software makers will be entitled to the resale of the computer software through the harmony of the distribution doesn’t come beneath the payment of royalty so for the use of the copyright in the computer software and that the same does not give rise to any income payable in India, this takes the person under copyright in the computer software, and that the same does not give rise to any income taxable in India, and hence not referred to be deducted with Tax Deducted at Source (TDS) under section 195 of the Income Tax Act. The answer to this question will connect towards 4 levels of cases.
