TaxTMI 
TaxTMI 
TaxTMI 
2018 (7) TMI 2305
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....nsponders and downlinking the same over the territory of India, sale of airtime on its channel to Indian persons and collection of subscription from cable operators in India. The assessee is receiving revenue's in form of advertising, distribution income being the primary source of income. The assessee has filed its return of income for AY 2009-10 declaring total income at Nil. The assessee in its return of income, filed Notes to the computation of income and claimed that Taj TV is carrying on business from outside India and it does not have business connection in India. It has neither a fixed place of business in India, nor has any project / office in India as defined in paras 1 & 2 of Article 5 of the DTAA between India and Mauritius. The management and control of Taj TV is situated outside India. Accordingly it was stated that there is no permanent establishment for the assessee in India and hence, the income earned by it from its activities is not liable to tax in India. 3. The case has been selected for scrutiny and accordingly, notices u/s 143(2) & 142(1) of the Act, were issued. In response to notices, the authorized representative appeared from time to time and filed vario....
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....eemed to accrue or arise in India. The CIT(A), after considering relevant submissions of the assessee and also relying upon certain judicial precedents, held that the assessee is liable to tax in India on the income which is attributable to its activities in India carried out by the Taj India with respect to its advertising receipts based on the functional analysis of this activity. The AO concluded that 75% of the income is liable to tax in India. Therefore, he opined that the AO was right in concluding that the assessee is having PE in India and income attributable to its activities in India is assessable in India. Accordingly, he upheld the findings of the AO and rejected ground raised by the assessee. Insofar as disallowance of programming cost and transponder charges paid to M/s PanAM Sat International System Inc., the CIT(A), after considering relevant facts and also relying upon various judicial precedents including, the decision of ITAT, Mumbai in assessee's own case observed that disallowance could not have been made by the AO as the amendment to section 9(1)(vi) had not been effected at the time of making the remittance and accordingly, the question of disallowance of pro....
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....organ Stanley & Co & other cases reported in (2007) 292 ITR 416 (SC) held that since Taj India is being remunerated at arm's length price, no further income or profit can be said to be attributable to the assesse in India from its PE. The relevant portion of the order is extracted below:- "9. As regards the AO's conclusion and finding that Distribution income earned by the assessee for the period 01.04,2002 to 12.07.2002, that is, for the period of little over 3 months, the distribution income earned by the assessee is be treated as 'royalty' income within the meaning of section lj(vi), because prior to 13.07.2002, assessee was not Resident of Mauritius and therefore, the benefit of DTAA will not be applicable and accordingly the income shall be taxable as per the Domestic Law, that is, Indian Income-tax Act; Ld, CIT(A) held that post 12.07.2002, the AO himself has held that distribution income is not 'royalty' albeit is a business income and will not fall within the meaning of "royalty" as defined under Article 12 of the India Mauritius DTAA post 13.07.2002. Thus, there cannot be two different treatments for same income. The assessee's case before the C1T....
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....Mum/2016 10. The Ld.AR for the assessee, at the outset, submitted that the issues involved in these appeals are also squarely covered in favour of the assessee by the decision of ITAT, in assessee's own case for AY 2006-07 in ITA No. 9079/Mum/2010, wherein under similar set of facts, the ITAT has deleted addition made by the AO towards programming cost paid to various non residents and also payments made to M/s PanAM Sat International System Inc. and other non residents towards transponder charges u/s 40(a)(i) for failure to deduct tax u/s 195 of the Income-tax Act, 1961. The Ld.DR, on the other hand, fairly accepted that the issues involved in these appeals are covered in favour of the assessee by the decision of ITAT for earlier assessment years. 11. Having heard both the sides and considered the material on record, we find that the co-ordinate bench of ITAT, "L" Bench in ITA No. 9079/Mum/2010 for AY 2006-07 has considered similar issue and after considering relevant provisions of the Act, and also by following its own order for AY 2003-04 to 2005-06 held that no disallowance can be made u/s 40(a)(i) on account of programming cost paid to various non residents and also payment....