Live feed payments are not technical fees or royalty where no know-how or content rights are transferred.

Receipts from live audio-video coverage of cricket matches were held not to be fees for technical services because the work only produced a finished live feed and did not make technical knowledge, experience or skill available to the recipient. The agreement's technical specifications were treated as broadcast quality-control requirements, not a transfer of know-how. The receipts were also held not to be royalty, as they were paid for production of program content and not for use of copyright, equipment, or similar property, with no transfer of rights in the content shown. Given the accepted service permanent establishment, the receipts were to be examined as business income under the India-UK DTAA.

---

---

Issues: (i) Whether the receipts from live audio-video coverage of cricket matches were taxable as fees for technical services or royalty, or as business income under the India-UK DTAA.

Analysis: The arrangement was examined in light of the treaty definition of fees for technical services, particularly the requirement that technical knowledge, experience or skill be made available to the recipient. The work performed by the assessee was limited to producing the live feed as a final program content product; it did not transfer technology, know-how, or enable the recipient to independently perform the same function. The technical specifications in the agreement were held to be quality-control requirements for broadcasting and not a transfer of technical know-how. On royalty, the payment was found to be for production of program content, not for the use of or right to use any copyright, equipment, or similar property, and no transfer of rights in the produced content was shown. Since the assessee accepted the existence of a service permanent establishment, the receipts were directed to be examined as business income under the treaty.

Conclusion: The receipts were not fees for technical services or royalty and were taxable as business income in India, subject to the treaty provisions applicable to the permanent establishment.

Final Conclusion: The Revenue's challenge to the characterization of receipts failed, while the interest issue was sent back for fresh consideration by the Assessing Officer, resulting in a partly favourable outcome for the assessee.

Ratio Decidendi: Production and delivery of a finished live feed does not amount to making technical knowledge available, and payment for such production does not constitute royalty unless rights in copyright or similar property are transferred.

---