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2012 (7) TMI 186 - AT - Income TaxJustification to allow deduction u/s 40(a)(ia) being 25% of the royalty paid - AO stated that as the assessee fails to comply its liability to TDS u/s. 194J the entire amount paid as royalty warrants disallowance - Held that:- As the payment in question was made by the assessee for obtaining certain rights over the film Boa and Passion including rights of distribution and exhibition of cinematographic films and also satellite TV protecting rights. In view of the specific provisions of Explanation 2, clause (v) of section 9(1)(vi) consideration for distribution or exhibition of cinematographic films are excluded from the purview of definition of royalty. The CIT(A) bifurcated the value of the rights acquired by the assessee and has attributed 25% of the payments made as attributable to TV rights which would be royalty taxable in the hands of the non-resident in India - in favour of assessee. Additions on Payment made on Studio Hire Charges - CIT(A)deleted additions made by AO - Held that:- As the assessee had utilized the services of dubbing studio by using their equipments as well as the artists who were working for Studio, the assessee had thus carried out the work of dubbing by engaging services and the same was of the nature of getting work done through a sub-contractor - that the provisions of section 194C were applicable and the assessee has rightly deducted tax at source at 2% treating the payment as a payment to subcontractor for carrying out a work - in favour of assessee.
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