9911796707
TMI Blog2022 (7) TMI 1375X X X X Extracts X X X X X X X X Extracts X X X X ..... in assessee s own case for the A.Y. 2006-07[ 2011 (12) TMI 195 - ITAT MUMBAI] wherein it is held As rightly held by the CIT (A) even if income arises to the Non-Resident due to the business connection in India, the income accruing or arising out of such business connection can only be taxed to the extent of the activities attributed to permanent establishment. In this case, the assessee does not have any permanent establishment in India. Since the Indian company who obtained the rights is acting independently, Agency PE provisions are not applicable to the assessee company. The assessee relied on the decision of Ishikawajma-Harima Heavy Industries Ltd vs. Director of Income Tax [ 2007 (1) TMI 91 - SUPREME COURT] that incomes arising t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... produced by other third parties. Warner Bros Pictures International, a Division of Warner Bros Distributing Inc. (WBDI) has entered into an agreement with Warner Bros Pictures (India) Pvt. Ltd. ('WBPIPL') in April 01, 2009 granting exclusive rights of distribution of cinematographic film to WBPIPL, on payment of specified royalty in terms of the above referred Agreement. During the year under consideration the assessee has received ₹.42,59,04,410/- from WBPIPL under the terms of agreement, which has been characterized as 'Royalty Income' by the assessee and claimed exempt under the Act and the India-USA DTAA, both. The income was claimed to be non-taxable as Royalty income by the assessee on the basis of the exception ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the issue under appeal is squarely stood covered in assessee s favour by various decisions of this Tribunal right from A.Y. 2006-07 to 2017-18, copies of orders has been placed on record. SrNo Assessment Year ITA No. Date of Order Finding of Hon'ble ITAT 1 2006-07 ITA No. 3160/Mum/2010 30.12.2011 Para 11 2 2007-08 ITA No. 8734/Mum/2010 10.10.2012 Para 5.3 3 2008-09 ITA No. 8627/Mum/2011 22.02.2013 Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ival contentions and examined the facts on record. There is no dispute with reference to the fact that the assessee has entered into agreement with Warner Brothers Pictures India (P) Ltd outside India and the amounts were also received outside India. There is also no dispute with reference to the fact that the definition of royalty under section 9(1)(vi) Explanation 2 to (v) excludes the payment received with reference to sale, distribution and exhibition of cinematographic films. There is also no dispute with reference to the provisions of DTAA entered into by India with USA, notified on 20th December, 1990, that the term royalty used in the Article 12 does not include payment of any gain received as consideration for the use of any copyri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee and Indian Company to whom license was granted by virtue of the agreement cannot be considered as Agency PE as the Indian assessee is not exclusively dealing with the assessee and referred to the receipts from another company 20th Century Fox to submit that the assessee is also dealing with the other Non Resident Companies, so assessee cannot be considered as Agency PE within the definition of Permanent Establishment. 11) We have examined this aspect also. As rightly held by the CIT (A) even if income arises to the Non-Resident due to the business connection in India, the income accruing or arising out of such business connection can only be taxed to the extent of the activities attributed to permanent establishment. In this ..... X X X X Extracts X X X X X X X X Extracts X X X X
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