TaxTMI 
TaxTMI 
2024 (10) TMI 427
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.... 3. As is evident from a reading of the initial notice referable to section 148A(b), the respondent had asserted that the revenue received by the petitioner from an Indian payer had not been subjected to deduction of tax at source even though the consideration received was income chargeable to tax in India. It accordingly called upon the petitioner to show cause why the income of INR 61,86,635 being income sourced in India and chargeable to tax be not viewed as income which had escaped assessment. 4. The revenues earned by the writ petitioner emanated from an agreement dated December 31, 2016 entered into between it and Lex Sportel Vision Private Ltd. (Lex Sportel.) for the grant of exclusive rights for telecast of matches pertaining to the Brazilian National Championship First Division League and the Brazil's State Championship First Division (Serie A1). 5. Before us, it was categorically stated that the aforesaid agreement covered the entire period comprised in the assessment years 2016-17, 2017-18 and 2018-19 and was the solitary agreement concerned with the grant of licence to Lex Sportel. 6. We also deem it apposite to notice the bifurcation of licence fee betwee....
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.... 4. In view of the above, the assessee was asked to show cause vide notice under section 148A(b) of the Act dated March 31, 2022 as to why a notice under section 148 of the Act should not be issued to it. Such notice was duly served upon the assessee through e-mail. The date for compliance was fixed on or before April 18, 2022 which was further extended up to May 4, 2022 and May 23, 2022 upon the request of the assessee. The assessee has claimed that it has received an amount of Rs. 45,88,036 from the said payer instead of Rs. 61,86,635. However, the assessee has not furnished any material evidence to back such claim. Further, from the examination of the response submitted by the assessee it is noticed that only a nominal fraction of the above income amounting to five per cent. of the same has been offered to tax as royalty by the assessee in its Income-tax return filed on October 31, 2018 on the ground that only broadcasting rights for non-live content are taxable in India. For the remaining amount, the assessee has claimed that being live content, the same is not covered under royalty. However, the assessee has not provided any document to substantiate/support such bifurcation....
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....have clearly stated and agreed that there are two streams of fees, one from live transmission and other from non-live and even payments have been made separately under these distinctive heads, then to hold that both constitutes one and the same thing will not be correct specifically when the core issue involved in this appeal is, whether the fees from live transmission constitute copyright so as to fall within the ambit of "royalty" or/and whether it is taxable.' 8. In view of the findings as expressed above, we find no merit in the contention of the appellants that the ratio adopted for the purposes of bifurcation of income was either unsubstantiated or arbitrary. 9. Before us, both Mr. Bhatia as well as Mr. Rai have assailed the view taken by the Income-tax Appellate Tribunal contending that the service from which income was generated would clearly fall within the ambit of Explanation 2 as placed in section 9(1)(vi) of the Act. 10. We, however note that CIT v. Delhi Race Club (1940) Ltd. 1 has clearly ruled on the scope and ambit of the expression 'the transfer of all or any rights (including the granting of a licence), in respect of any copyrig....
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....ight" would encompass all categories of work including musical, dramatic, etc., and also his submission that the Copyright Act acknowledges the broadcast right as a right similar to "copyright". In view of the conclusion of this court in ESPN Star Sports Mauritius S. N. C. ET Compagnie v. Union of India 1 case, such a submission need to be rejected. In this regard we also quote for benefit the judgment of this court in the case of Akuate Internet Services (P.) Ltd. v. Star India (P.) Ltd. 2013 SCC OnLine Delhi 3344 as relied upon by learned counsel for the respondent-assessee wherein a Division Bench of this court has applied the test of "minimum requirement of creativity" for claiming a right under the Copy right Act, which is absent in a "live telecast of an event". We note for benefit that the United States Court of Appeal Second Circuit Ruling in National Basket Ball Association & NBA Properties NIC v. Motorola Inc. 105 F 3d 841 (1997) held that a sports event is a performance and not a work. It is not copyrightable. 18. In so far as the submission of Mr. Sawhney that the live telecast of an event is the outcome of "scientific work" and payment thereo....
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....oncerned, again neither such a case was set up before the authorities, nor in this appeal. In fact it is not known nor pleaded that the live telecast, in this case, was accompanied by commentary, analysis, etc. It is an issue of fact, which cannot be gone into or raised at this stage. In view of our discussion above, we are of the view that no question of law arises in the present appeals. We dismiss the appeals filed by the appellant-Revenue.' 12. In the light of the unequivocal conclusions as expressed by the Division Bench in Delhi Race Club [CIT v. Delhi Race Club (1940) Ltd. 2014 SCC OnLine Delhi 7619] and with which we concur, we find that once the court came to the conclusion that a live telecast would not fall within the ambit of the expression 'work', it would be wholly erroneous to hold that the income derived by the assessee in respect of 'live feed' would fall within clause (v) of Explanation 2 to section 9(1)(vi) of the Act. 13. Notwithstanding the above, Mr. Rai, learned counsel appearing for the appellant, additionally sought to place the respondent's income in clause (i) of Explanation 2 to section 9(1)(vi) of the Act and so....