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TMI Blog2019 (4) TMI 1621X X X X Extracts X X X X X X X X Extracts X X X X ..... Agreement contains Article 12 pertaining to royalty and fees for technical service. Even going by this definition, the payment in question can not be categorized as royalty. - INCOME TAX APPEAL NO.103 OF 2017 WITH INCOME TAX APPEAL NO.207 OF 2017 - - - Dated:- 23-4-2019 - AKIL KURESHI AND SARANG V. KOTWAL, JJ. Mr. Tejveer Singh for the Appellant. Mr. Percy Pardiwalla, Senior Counsel with Mr. Nitesh Joshi i/by Mr. Sameer Dalal for the Respondent. P.C.: 1. Issues being identical, we may notice facts from Appeal No. 103 of 2017. 2. This appeal is filed by the revenue to challenge the judgment of Income Tax Appellate Tribunal. Following questions are presented for our consideration:::: a. Whether on the facts and circumstances of the case and in law, the tribunal is correct in deciding the issue in favour of the assessee relating to the addition of income as per rule 10A on account of Advertisement Revenue and Distribution revenue ignoring the fact that the assessee has a PE in India? b. Whether on the facts and circumstances of the case and in law, the ITAT is correct in not treating M/s Multi Scre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia as long as the treaty and Circular stands. 14. In the light of the above Appeal filed by the Appellant herein is allowed and the order of the ITAT is set aside. Merely because tax on income was paid for some assessment years would not estop the assessee from contending that its income is not liable to tax. The order of CIT is restored except to the extent that it has said that it cannot interfere because the Appellant had paid the tax. That part is set aside. 5. It was in this context that the Tribunal in the impugned judgment had referred to the earlier assessments in case of this very assessee, in which the issue was decided in favour of the assessee. In that view of the matter, question No.a is not required to be entertained. Once we come to this conclusion, question (b) becomes academic. In any case, the Tribunal had proceeded on the basis that the assessee has a permanent establishment in India despite which it would have no tax liability in India. In that view of the matter, it can also be stated that question (b) does not arise out of the judgment of the Tribunal. 6. So far as question (c) is concerned, we notice that the Tribunal in the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us programmes; entertainment, educational or otherwise. SET India Private Limited through layers of multi system operators and cable operators collects subscription charges to enable individual customers to view the channels and the programmes telecast on such channels. The revenue so collected from large number of customers would eventually reach the assessee after adjustment of intermediary charges paid to the different agencies. The revenue contends that these payments made to the assessee are in the nature of royalty for use of copyright. The assessee contends that the same is a business income and under no circumstances can be categorized as royalty payment. 9. We may notice that in case of SET India Private Limited, the Tribunal had addressed a similar question in its judgment dated 25th April, 2012 in Income Tax Appeal No.4372 of 2004. The Tribunal while confirming the decision of CIT (Appeals), in the said judgment held and observed as under: 6. Having heard both the sides, we observe that ld CIT (A) while examining the issue has stated that the Nonresident company has granted nonexclusive distribution rights of the channels to the assessee and has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1957, as to mean any of the works namely a literary, dramatic, musical or artistic work or a cinematograph film and a sound recording. Subsection (1) of Section 14 of the Copyright Act, 1957 lists several Acts in respect of a work in relation to which exclusive right would be termed as copyright. In the present case, the assessee had not created any literary, dramatic, musical or artistic work or cinematograph film and/or a sound recording. 11. Infact, Section 37 of Copyright Act, 1957 separately defines broadcast reproduction right. Subsection (1) of Section 37 of the said Act provides that every broadcasting organisation shall have special rights to be known as broadcast reproduction right in respect of its broadcasts. Subsection (2) of Section 37 provides that the broadcast reproduction right shall subsist until twenty-five years from the beginning of the calender year next following the year in which the broadcast is made. 12. Section 9 of the Act pertains to income deemed to accrue or arise in India. Clause (vi) of Section 9(1) pertains to income by way of royalty. Relevant portion reads as under: (vi) income by way of royalty payable by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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