The Karnataka High Court recently issued a decision regarding the treatment of payments for online advertisements as taxable royalties under the 1989 India-U.S. tax treaty. The case involved a company, Urban Ladder, which made payments for online advertising services to Facebook and two other companies, on which no tax was withheld. The assessing officer determined, however, that the payment qualified as taxable royalties and issued an assessment for tax that should have been withheld. In its…