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TMI Blog2023 (2) TMI 857X X X X Extracts X X X X X X X X Extracts X X X X ..... d it is not a case of transfer of process. On similar set of issues on live broadcast of sporting and cricket events, in the case of Neo Sports Broadcast (P.) Ltd. [ 2011 (11) TMI 23 - ITAT MUMBAI] and Nimbus Communication Ltd. [ 2013 (9) TMI 795 - ITAT MUMBAI] have held that there is no copyright on live events, and therefore, it is not taxable as 'royalty', thus, we hold that the fee received towards live transmission cannot be taxed as 'royalty' in terms of Section 9(l)(vi) as held by the Hon'ble Jurisdictional High Court and also by the Coordinate Bench of ITAT. Accordingly, we decide this issue in favour of the assessee. Short credit of taxes deducted at source though reflected in Form 26AS - HELD THAT:- We direct the Assessing officer to verify the same and grant correct credit of taxes deducted at source. Ground is allowed for statistical purposes. Charging of interest of interest u/s 234B is consequential - AO will recalculate the charging of interest, if any, while giving effect to the appellate order. - SHRI NARENDRA KUMAR BILLAIYA , ACCOUNTANT MEMBER AND SHRI KUL BHARAT , JUDICIAL MEMBER For the Assessee : Sh. Porus Kaka , Sr. Adv. For the Departmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appreciating the fact that the same is reflected in Form 26AS. Ground number 8 erred in levying interest under Section 234B of the Act of Rs 1,11,83,15,110 Ground number 9 erred in initiating penalty proceedings under Section 271(1 )(c) of the Act without appreciating the fact that the Appellant has not concealed any income nor furnished any inaccurate particulars of its income. 2. Facts giving rise to the present appeal are that the assessee, a foreign company, filed its return of income on 28.11.2014 declaring total income of Rs. 90,35,46,336/-. The case was picked for compulsory scrutiny through CASS. The Assessing Officer referred the matter to Transfer pricing Officer ( TPO ) after obtaining the prior approval of the Competent Authority. However, he did not propose any adjustment. Thereafter, a draft assessment order was passed whereby the Assessing officer proposed addition of royalty income amounting to Rs. 752,16,50,223/-. Aggrieved against this the assessee filed its objection before the learned Dispute Resolution Panel (DRP), who after considering the submissions and the objections of the assessee upheld the adjustment made by the AO. Thereafter, the Assessing Officer pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he submissions of the learned counsel for the assessee. He strongly relied on the orders of authorities below to buttress the contention. 7. Heard the learned representatives of the parties and perused the material available on record. We find that under identical facts the co-ordinate Bench of this Tribunal in the case of Fox Network Group Singapore Pte. Ltd. [121 taxmann.com 330 (Delhi-Trib.)], has decided the issue under consideration by observing as under:- 20. This precise issue had come up for consideration before the Hon'ble Jurisdictional High Court in the case of Delhi Race Club (supra) that, whether any payment for broadcast or live coverage will constitute copyright, and therefore, is taxable under the ambit of royalty in terms of. Explanation 2 to Section (l)(vz). The fact of that case was that assessees had made payment to other clubs/centers on account of live telecast of horse racing. The Assessing Officer has made the disallowance u/s. 40(a)(ia) on account of royalty paid to other centers for live telecast. According to him, the same was covered under section 194J. The contention of the Revenue before the Hon'ble High Court was: (i) clause (v) to Explanation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the word 'copyright' encompasses in itself all the categories of work. Having done it is a case of Expressio Unis'. (The mention of one thing is the exclusion of the other). It was also noted that the word 'copyright' does not synchronize with the word 'literary', 'artistic' as they are the works in which 'copyright' exists. The provision if read as suggested by the revenue to that extent would be meaningless. Thus, the provision would be more meaningful if the word in is read by implication in-between the words-'copyrighf and 'literary'. [Para 8] - There is limitation on the Court in adding and rejecting a word in the provision and the statute. Presumption is there that the legislature inserted every part of the statute for a purpose with an intention that every part thereof should have effect. At the same time, it is also a settled law that a construction which attracts redundancy, will not be accepted except for compelling reasons. Where alternative lies between either supplying by implication, words which appear to have been accidentally omitted or adopting a construction depriving certain existing words of all meaning ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce to state that a live telecast/broadcast would have no 'copyright'. This issue is well settled in view of the position of law as laid down by this Court in case of ESPN Star Sport v. Global Broadcast News Ltd. 2008 (38) PTC - 7, wherein this Court after analysing the provisions of the Copyright Act was of the view that legislature itself by terming broadcast rights as those akin to copyright1 clearly brought out the distinction between two rights in Copyright Act, 1957. According to the Court, it was a clear manifestation of legislative intent to treat copyright and broadcasting reproduction rights as distinct and separate rights. It also held that the amendment of the Act in 1994 not only extended such rights to all broadcasting organizations but also clearly crystallized the nature of such rights. The Court did not accept the contention of the respondent that the two rights are not mutually exclusive by holding that the two rights though akin are nevertheless separate and distinct. [Para 17] - In view of the aforesaid position of law which brought out a distinction between a copyright and broadcast right, suffice would it be to state that the broadcast or the live cover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... me relevant to understand the scope of this part of the provision Suffice to state, when reference is made to films or video tapes, then the intent of the provision is related to work of sound recording or any medium or video tape and can be seen on television surely such a work does not include a live telecast. This submission is also need to be rejected. Insofar as the submission of revenue that analysis, commentary and use of technology to live feed make the broadcast a subject matter of distant copyright is concerned, again neither such a case was set up before the authorities, nor in this appeal. In fact it is not known nor pleaded that the live telecast, in this case, was accompanied by commentary, analysis etc. It is an issue of fact, which cannot be gone into or raised at this stage. [Para 19] 22. The aforesaid principle and sequitur of the judgment of the Hon'ble Jurisdictional High Court clearly clinches the issue in favour of the assessee, wherein it has been categorically held that there is a clear distinction between a copyright and a broadcasting right, broadcast or live coverage which does not have a copyright, and therefore, payment for live telecast is neither ..... X X X X Extracts X X X X X X X X Extracts X X X X
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