Cricket live feed not classified as royalty under tax agreement. Decision supported by Delhi High Court ruling.

The Tribunal held that the amount received by the assessee from the Board of Control of Cricket in India (BCCI) for preparing live feed of cricket matches was not "fees for technical services" or "royalty" under the India UK Double Taxation Avoidance Agreement. The Tribunal determined that the payment did not involve the use of any copyright or transfer of rights in respect of any copyright or scientific works, thus not meeting the criteria for royalty classification. The decision was supported by a ruling of the Delhi High Court in a similar case.

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Issues:
1. Whether the Tribunal was justified in directing the AO not to treat the amount received by the assessee as "fees for technical services"Rs.
2. Whether the Tribunal was justified in directing the AO not to treat the amount received by the assessee as "royalty"Rs.

Analysis:

Issue 1:
The Tribunal was questioned on the justification of directing the Assessing Officer (AO) not to consider the amount received by the assessee as "fees for technical services." The Revenue argued that the payment received by the assessee from the Board of Control of Cricket in India (BCCI) for preparing live feed of cricket matches should be classified as "fees for technical services." However, the Tribunal rejected this contention. The Tribunal analyzed the nature of the payment and referred to the definition of royalty under the India UK Double Taxation Avoidance Agreement (DTAA). It concluded that the payment in question did not fall under the definition of royalty as it was not made for the use of any copyright or right to use any industrial, commercial, or scientific equipment. The Tribunal's decision was supported by the Delhi High Court's ruling in a similar case. The Tribunal found that the payment received by the assessee was not for the use of any copyright and, therefore, cannot be categorized as royalty. The Tribunal upheld its decision based on the specific nature of the payments made by the BCCI to the assessee for preparing live cricket match coverage.

Issue 2:
The second question raised by the Revenue was whether the Tribunal was justified in directing the AO not to treat the amount received by the assessee as "royalty." The Revenue contended that the payment made to the assessee was for imparting information concerning commercial or scientific knowledge, experience, or skill, falling under the definition of royalty as per the DTAA between India and the UK. The Tribunal examined the definition of royalty under the DTAA, emphasizing that the payment in question must be for the use of or right to use any copyright or industrial, commercial, or scientific equipment to qualify as royalty. After reviewing the facts and documents, the Tribunal concluded that the payment received by the assessee did not involve the use of any copyright or transfer of rights in respect of any copyright or scientific works. Therefore, the Tribunal upheld its decision not to treat the payment as royalty, as there was no copyright vested in the assessee for which the payment was being made. The Tribunal found that the assessee was engaged in providing live cricket match coverage under a contract with the BCCI, and the payment did not constitute royalty under the DTAA.

This comprehensive analysis of the judgment highlights the Tribunal's reasoning behind its decision regarding the classification of the payment received by the assessee from the BCCI, addressing both issues raised by the Revenue in detail.

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