TaxTMI 
TaxTMI 
2020 (2) TMI 1225
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....by the appellant qualify as "Royalty" under the provisions of Section 9(i)(vi) of the Act as well as Article 13 of the DTAA. 3.2. On the facts and in the circumstances of the case & in law, the Ld. DRP / Ld. AO, erred in not appreciating that the issue under consideration has authoritatively been decided by the ITAT, Mumbai in favour of the appellant in AY 2009-10 to AY 2012-13, AY 2014-15 and AY 2015-16 observing that the production work undertaken is a live coverage of event and hence the income earned there from would not qualify as "Royalty" under the provisions of the Act and the DTAA. 3.3. On the facts and in the circumstances of the case & in law. The Ld. DRP / Ld. AO erred in not appreciating that the Hon'ble Bombay High Court in Appellant's case for AY 2010-11 has not admitted the substantial question of law with respect to treating the income as "Royalty" under the provisions of the Act and the DTAA. 3.4. On the facts and in the circumstances of the case & in law. The Ld. DRP / Ld. AO erred in alleging that the appellant received consideration for allowing it to use copyright in its scientific work, being the feed, which would qualify as....
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.... of the assessee ends upon the production of the 'program content'. According to the assessee, the program content shall become the property of the BCCI. We notice that the revenue has not brought any material on record to show that the assessee has kept the ownership rights over the program content. The Ld DRP has noticed that the BCCI is required to supply certain equipments and hence the Ld DRP has held as under:- "...the assessee would be using equipments to carry out this work which is nothing but equipment royalty as per the Act as well as the DTAA." We are unable to understand the rationale behind this observation. If the assessee was using the equipments belonging to BCCI and if that activity is examined in isolation, then the assessee should be paying money to BCCI for using the equipments. In the instant case, the assessee has received the money for producing live coverage of cricket matches. The equipments required for the said purpose may be brought by the assessee itself or it may be provided by the BCCI. Under commercial terms, if the assessee was required to bring the equipments, then the consideration payable for the production of live coverage of ....
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....i High Court observed as under:- "16. A live T.V coverage of any event is a communication of visual images to the public and would fall within the definition of the word 'broadcast' in Section 2(dd) (of the Copyright Act). That apart we note that Section 13 does not contemplate broadcast as a work in which 'copyright' subsists as the said Section contemplates 'copyright' to subsist in literary, dramatic, musical and artistic work, cinematograph films and sound recording. Similar is the provision of Section 14 of the Copyright Act which stipulates the exclusive right to do certain acts. A reading of Section 14 would reveal that 'copyright' means exclusive right to reproduce, issue copies, translate, adapt etc., of a work which is already existing... 18. In view of the aforesaid position of law which brought out a distinction between a copyright and broadcast right, sufficie would it be to state that the broadcast or the live coverage does not have a 'copyright'. The aforesaid would meet the submission of Mr. Sawney that the word 'Copyright' would encompass all categories of work including musical, dramatic, etc. and also his submission that the Copyright acknowledg....
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....transfer of rights in respect of any copyright or scientific works within the meaning of Explanation 2(v) to Section 9(1) (vi) of the Act as well as under the DTAA between India and the UK." 5 This question arises in following back-ground. RespondentAssessee was engaged by Board of Control of Cricket in India (for short "BCCI") for preparing live feed of cricket matches which would be telecast on TV channels. The Revenue's first contention was that, the payment received by the Assessee from the BCCI for such work, was in the nature of "Fee for technical services". Revenue's alternate contention was that, following first contention, the payment to the Assessee was in the nature of royalty. The Income Tax Appellate Tribunal (for short "the Tribunal") rejected both the contentions. The second question argued before us by the Revenue relates to the Tribunal's decision to reject the alternate contention of the Revenue. 6 Having heard the learned Counsel for the parties on this issue and having perused the documents on record, the Tribunal referred to royalty as defined under IndiaUK Double Taxation Avoidance Agreement (DTAA) and held that the payme....
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..... The assessee succeeds on the issue. 8. Ground no 3 is thus allowed. 9. In ground no 4, the assessee appellant has raised the following grievances:- 4. Fees for Technical Services 4.1. On the facts and in circumstances of the case & in law, the Ld. DRP/ Ld. AO has erred in characterising the services provided by the appellant as "Fee for Technical Services" (FTS) under the provisions of section 9(i)(vii) of the Act as well as Article 13 of DTAA. 4.2. On the facts and in the circumstances of the case & in law, the Ld. DRP / Ld. AO, erred in not appreciating that the issue under consideration has authoritatively been decided by the ITAT, Mumbai in favour of the appellant in AY 2009-10 to AY 2012-13, AY 2014-15 and AY 2015-16. 4.3. On the facts and in circumstances of the case and in law, the Ld. DRP/ Ld. AO has erred in ignoring that the activity of live audio and video coverage of events constitute production of programmes and falls under the definition of "work" provided under Explanation (iv) to Section 194C of the Act and hence the same would not qualify as "service"' and consequently will not be taxable as "1(TS" under Section 9(i)(....
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....dards in minute details and the same results in total exchange of technical plans and designs between the assessee and the broadcasters. In our view, there is a fallacy in the view taken by Ld DRP. The object of the production of live feed is to offer quality coverage of the live cricket matches to the viewers. The assessee's job is restricted to production of live coverage and the job of broadcasting the same is undertaken by the BCCI. The BCCI, in turn, has given license to certain companies (called licensees) and they have undertaken the job of broadcasting the live coverage of cricket matches on behalf of BCCI. Since the assessee is supplying the live coverage in the form of digitalized signals, it has to ensure that the broad casters also do have the compatible technology and equipments so that the live coverage can be broadcast without compromising the quality. Thus, in our view, the technical aspects are specified in the agreement in order to ensure that the program content is broadcast at the same quality in which it was produced. The same was sought to be achieved by synchronizing the quality of technical equipments between the assessee and the broadcasters (licensees). Su....
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....ibunal did not examine the principle of 'make available'. We notice that the case of Nimbus Sport International Pte Ltd is covered by India-Singapore DTAA and it also uses the expression "make available" in the definition of "Fee for technical services". In the case of Nimbus sports International (supra), the principle or concept of 'make available' has not been examined by the Tribunal. Accordingly, we agree with the contentions of the assessee that the said decision is distinguishable. 11. The view so taken by the co-ordinate benches have consistently been followed by several other co-ordinate benches as well. No doubt, Hon'ble Jurisdictional High Court has, vide order dated 05.02.2019, admitted an appeal, against the aforesaid decision of the c-oordinate bench, but that does not dilute binding nature of the judicial precedent. 12. Having heard the rival contentions, and having perused the material on record, we see no reasons to take any other view of the matter than the view taken by the co-ordinate benches. Respectfully following the co-ordinate benches, we uphold the grievances of the assessee. The assessee succeeds as this issue as well. 14. In ground no 5, the asse....