Live sports coverage receipts were held outside royalty and technical services treatment; profit attribution was remanded for fresh review.

Receipts for producing live cricket match coverage were not royalty because the payment was for creating and supplying the live feed, not for granting any right to use copyright or similar property. The distinction between a broadcast right and copyright was treated as material, and the receipts therefore fell outside the royalty definition. The same receipts were also not fee for technical services because the technical expertise used in production was not made available to the recipient for independent use; no know-how, skill or process was transferred enabling the recipient to produce the feed itself. The ad hoc profit attribution between the PE and head office was remanded for fresh adjudication.

---

---

Issues: (i) Whether receipts from production of live coverage of cricket matches were taxable as royalty; (ii) Whether the same receipts constituted fee for technical services; (iii) Whether the addition made by ad hoc attribution of profits between the permanent establishment and head office required fresh adjudication.

Issue (i): Whether receipts from production of live coverage of cricket matches were taxable as royalty.

Analysis: The activity consisted of producing program content and live coverage, after which the content vested with the contracting entity and was broadcast by others. The payment was for producing the live feed, not for granting any right to use copyright or similar property. The distinction between broadcast right and copyright was material, and the receipt did not answer the treaty definition of royalty or the domestic law concept relied upon by the revenue.

Conclusion: The receipts were not royalty and the issue was decided in favour of the assessee.

Issue (ii): Whether the same receipts constituted fee for technical services.

Analysis: The production of live feed involved technical expertise, but the relevant test was whether such expertise was made available to the recipient so that it could be independently used. The material showed only supply of the final program content and not transfer of technical know-how, skill, or processes enabling the recipient to produce the feed on its own. The make available condition was therefore not satisfied.

Conclusion: The receipts did not constitute fee for technical services and the issue was decided in favour of the assessee.

Issue (iii): Whether the addition made by ad hoc attribution of profits between the permanent establishment and head office required fresh adjudication.

Analysis: The parties agreed that this aspect should be sent back for reconsideration in the light of the earlier tribunal orders on the same subject. The additional profit attribution was therefore not finally determined on merits and was remitted for denovo decision.

Conclusion: The issue was remanded for fresh adjudication.

Final Conclusion: The assessee succeeded on the royalty and fee-for-technical-services disputes, while the profit-attribution issue was reopened for reconsideration, resulting in a partial allowance of the appeal.

Ratio Decidendi: Payments for production of live broadcast content are not royalty unless they involve a right to use copyright or similar property, and they are not fee for technical services unless technical knowledge, skill, or know-how is made available to the recipient for independent use.

---