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2016 (8) TMI 504 - ITAT MUMBAI

2016 (8) TMI 504 - ITAT MUMBAI - TMI - TDS u/s 195 - income from Indian operation - whether the assessee did had an agency PE in the form of Taj India within the meaning of Article 5(4) of the India-Mauritius-DTAA? - Held that:- An agent is deemed to be a PE of a foreign enterprise, if he is not independent and has habitually exercises an authority to conclude contracts in the name of the enterprise unless the activities of such person are limited to those mentioned in paragraph 4 that is, to th .....

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of an agency PE that the agent has sufficient authority to bind the enterprise’s participation in the business activity. Here in this case, none of the conditions as stipulated in Article 5(4) is applicable because Taj India is acting independently qua its distribution rights and the entire agreement ostensibly is on principal to principal basis as analyzed and found by ld. CIT (A). When the entire relationship qua the distribution revenue is that of principal to principal basis and the Taj Indi .....

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of transponder for telecasting ‘Ten Sports’ channel in various countries including India - Indo-US-DTAA - Held that:- Payment made to the non-resident outside India for rendering the services of equipment outside India is not taxable in India. Hon’ble Delhi High Court in the case of Asia Satellite Telecommunications vs. DIT, reported in (2011 (1) TMI 47 - DELHI HIGH COURT ) later on reiterated that there is no royalty payment in such cases under the domestic law, that is, section 9(1)(vi), prio .....

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- ITAT MUMBAI ) wherein, it has been held that, assessee cannot held to be liable for deducting TDS in view of the retrospective amendment which has come at a much later date. Thus, we hold that assessee was not liable to deduct TDS at the time of making the payments. Accordingly, disallowance under section 40(a)(i) could not have been made by the AO - Decided in favour of assessee - Distribution of income taxable as ‘royalty’ under section 9(1)(vi) up to 12th July, 2002 - Held that:- We ar .....

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e. In any case, as stated earlier, under the distribution agreement, the assessee company has not granted any license to use any copyright to the distributor or to the cable operators. The assessee only makes available the content to the cable operators which are transmitted by them to the ultimate customer/viewers. Further, rights over the content at all times lies with the Assessee Company and are never made available with the distributors or cable operators. Thus, the finding of the CIT(A) on .....

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us nonresident outside India for acquiring right brought on sports events taking place outside India. Thus, such programming cost cannot be deemed to arise in India as liability to pay programming cost as assumed by the assessee company outside India and it cannot be held to be borne by any PE in India. - Decided in favour of assessee - ITA No. : 4678/Mum/2007, ITA No.: 412/Mum/2008, ITA No.: 4176/Mum/2009, ITA No.: 5537/Mum/2008, ITA No.: 5536/Mum/2008, ITA No.: 4706/Mum/2009 - Dated:- 5-7-20 .....

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issues are involved in all the appeals, therefore, same were heard together and are being disposed off by way of this consolidated order. 2. We will first take-up revenue s appeal for the assessment year 2003-04, which will also cover the issues and grounds raised in the Department s appeals for the AYs 2004-05 & 2005-06. Grounds of appeal as raised by the revenue read as under: 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that Taj India do .....

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and in law, the Ld. CIT(A) failed to appreciate that the income received from the assessee by M/s. PanAmSat being in the nature of transponder charges and received by other non-residents being in the nature of up linking charges have arisen in India and accordingly tax should have been deducted at source on such expenses. 3. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that the distribution income earned by the assessee during the period when it w .....

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company, that is, Taj T V Limited was registered under the laws of Mauritius and is a tax resident of Mauritius since 12th July, 2002. Prior to that, it was registered as a company in British Virgin Islands in the year 2000. It is engaged in the business of broadcasting of sports channel namely, Ten Sports all across the globe including India. Since it did not had any branch or business premises in India, therefore, it had formed a subsidiary, Taj Television India Private Limited (Taj India) as .....

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as also entered into on 1st March, 2002 by the Assessee with Taj India for the distribution of the pay channel to the various cable operators and ultimately to the consumers in India. The distribution revenue collected by Taj India is to be shared between Taj TV and Taj India in the ratio of 60:40, that is, 60% of revenue goes to Taj TV and balance 40% is retained by Taj India. Both the agreements were approved by Reserve Bank of India (RBI). For the assessment year 2003-04, the assessee had fil .....

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aj TV Ltd. (Taj TV or The Company ) is a foreign company registered under the Mauritian law. Taj-TV is engaged in the business of bringing to the Indian subcontinent and the Middle East the best in sports programming and production. Taj TV s primary focus is its sports channel programming and production. Taj TV s primary focus is its sports channel - Ten Sports. Taj is considered as resident for tax purposes in Mauritius as it is registered in Mauritius. We enclosed a copy of 'Tax Residency .....

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s been approved by the Reserve Bank of India ('RB') vide their approval letter No. EC. CO, EPD/310/210. 16.08/02- 03 dated 19 August 2002. As per the agr ee men t, Ta j In dia is en ti tl ed to 10% c om mission of th e advertisement revenues secured for Taj-TV, which is considered fair and reasonable. Taj India does not have any authority to enter into any contract on behalf of Ta]- TV. 3. Taj-TV has also appointed Ta]-India as the distributor vide agreement dated 1 March 2002, to distri .....

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net of Indian Income Tax. Taj-TV is registered in Mauritius and also it does not have any branch or office in India. Further, the telecasting is being done from outside India. 4. In view of the complexity of the issues involved in determining taxability of the Foreign Telecasting Companies ('FTC.$) and the extent of income that could be said to accrue or arise to them from their operations in India, the Central Board of Direct Taxes (CBDT) has issued a Circular No. 742 dated 2nd May, 1996 re .....

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A) on 24 August 1982 which is notified in India vide GSR 920(E) dated 26 December 1983. It is well settled that the provisions of the DTAA would override the general tax provisions (Refer Circular No.333 dated 2 April 1982 issued by the CBDT). In view of the same, the DTAA provisions would override the general tax provisions to the extent the general tax provisions are inconsistent with the DTAA provisions. 6. Article 7 of the India/Mauritius DTAA provides that a resident of Mauritius shall be l .....

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ncipal to principal basis and at arm s length prices. Taj-India does not have any authority to enter into any contract on behalf of Taj-TV and all the advertisement sales contracts are entered into between the advertisers and Taj-TV. The commission of 10% in respect of advertisement revenue is fair and consistent with industry practice, which has been approved by the RBI. In view of the same, it/s submitted that there is no RE in India resulting in any further tax implication. 8. The company hum .....

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ss situation, no profit can be attributed to Indian operations. 9. Section 139 of the Act requires every company including a foreign company to file return of income in India. In view of the same, without prejudice to the above, Taj-TV has prepared its financial statements for the year ended 31 March 2003 as applicable in the case of its Indian operations. The financial statements pertain to revenue derived from the Indian operations and costs attributable to the same (including apportionment of .....

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got them audited under section 44AB which was filed along with the return of income. It was reported that, the profit and loss account revealed revenue earned US $ 6,168,155 on which cost of sale was US $ 7,978,788 resulting into gross loss of US $ 1,810,633. The assessee had computed the total income in the return as per its India account at loss of US$ 6,726,450. Thus, it was stated that, there was a huge loss in Indian operations and which fact has not been disputed or rebutted by the AO als .....

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ights and granting of license in respect of trademark, copyright, secret formula, or process etc., including films and video tapes. The said agreement involves the use of or right to use the copyright, trademark, etc. owned by the company. The assessee company is providing service through Taj India and Taj India could not have rendered any service to the subscribers and cable operators without the trademark, copyright, etc. transferred to it by the assessee Company; Thirdly, the assessee company .....

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a company in Mauritius w.e.f. 12th July, 2002, therefore it is not entitled to treaty benefits of India-Mauritius DTAA in respect of distribution income earned up to 12 July 2002 (i.e. from 1.04.2002 to 12.07.2002) and such distribution income shall be taxable as 'Royalty'. However, he held that distribution income earned after 13th July, 2002 is connected with the PE in India and hence, it is taxable under Article- 7 of India-Mauritius-DTAA; Fourthly, he disallowed the Programming cost .....

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Systems Inc. USA (hereinafter referred to as the "PanAmSat") for rendering services through satellite, located outside India, in telecasting the sports channel 'Ten Sports' to various countries under section 40(a)(i) of the Act as no tax was deducted at source from such payment. According to him, it is in the nature of 'Royalty' and falls under clause (iv a) of Explanation 2 to Section 9(1)(vi) of the Act; and Lastly, he also disallowed the up-linking charges of US $ 3 .....

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siness loss computed by the assessee as per its Profit & Loss Account computed for the income from Indian operation. Thereafter he has proceeded to disallow various payments after invoking the provisions of section 40(a)(i) on the ground that same would be allowable in the year of payment of tax at source and lastly, the distribution revenue has been taxed as royalty income . 7. In the first appeal, so far as the issue of advertising revenue or income is concerned, the Ld. CIT(A) held that, .....

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ncy PE, because, the assessee has paid the commission of 10% which is at arm s length price to Taj India for the services rendered by it and the said payment of commission has been examined by the TPO both in the hands of the assessee as well as in the hands of the Taj India and no adjustment has been suggested. Thus, it was submitted that, once payment has been accepted to be at arm s length price then liability of the principal non-resident is extinguished in India. It was further submitted th .....

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ency agreement dated 08.05.2002, specifically with regard to clauses 1, 3, 5 and 6, came to the conclusion that Taj India was in fact, dependent agent of assessee in all respect and its income was from advertisement and distribution and the entire source of revenue of Taj India is from Ten Sports Channel. It did not have any income from any other source and, therefore, it was wholly dependent on assessee for its business. Thus, he concluded for all practical purpose, Taj India was exercising aut .....

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r itself and subsequently it enters into sub-distribution agreement with other parties in its own name to which the assessee company is not a party at all. The assessee had given exclusive right to Taj India for distribution of TV Channel and for such right it had agreed to pay 40% of the total subscription income earned as a consideration. Further, the agreement clearly stipulates that, Taj India shall be solely responsible for the marketing and promotion of the services to help drive cable ope .....

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usal of the entire gamut of the materials and the submission of the assessee, Ld. CIT(A) observed that, the assessee has appointed Taj India exclusively for distribution in India and prohibits assessee from a distribution agreement to anybody else. He further observed that Taj India is not acting as an agent of the assessee to obtain TV Channel itself and secondly, it has entered into contract with other parties and that too in his own name. From the perusal of the sub-distribution agreement, he .....

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gency PE for distribution income in terms of Article 5(4). 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 to be treated as royalty income within the meaning of section 9(1)(vi), because prior to 13.07.2002, assessee was not resident of Mauritius and therefore, the benefit of DTAA will not be applicable and accor .....

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nnels process is continuous and non-stop, which is initiated by the channel companies and ultimately enjoyed by the viewers. The business carried on by the channel companies is an indivisible and wholesome chain of activities, which cannot be segregated and packed as independent modules. All the players involved in the business take part simultaneously in carrying on of the telecasting business which runs instantly. In support the assessee has referred and relied upon the decision of ITAT, Mumba .....

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right over the programs belong to the Assessee Company, whereas the distributors or cable operators only transmit the signals received from the Assessee Company. They do not modify, alter, or replace the content of the telecast but broadcast the content as it is received by them from the Assessee Company. Therefore, it does not amount to transfer of any right over the copyright or granting any license over the copyright to the cable operators. Therefore, the AO has erred in taxing distribution i .....

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id for Transponder facility does not amount to Royalty as it is not for a secret process; or Fees for Included Services as it does not make available technical knowledge as per Article -12 of India-US DTAA. The ld. CIT(A) also held that the payment of transponder fees was not borne by the PE in India, hence, even if payment is held to be Royalty , it is still not taxable as it is not borne by PE of US company in India therefore, there was no obligation to deduct tax at source in view of Article .....

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the Satellite therefore, it is not in the nature of Royalty or Fees for included services . Ld. CIT(A) further held that the payment of Up linking charges is neither incurred in connection with the PE in India nor borne by the PE in India, therefore, there was no obligation to deduct tax at source. In respect of Programming cost paid to various cricket board and sport associations, which has been disallowed under section 40(a)(i) of the Act, the ld. CIT(A) held that Programming cost paid to acqu .....

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. Thus, after detailed discussion, ld. CIT(A) held that none of the payments would be taxable in India even if it is deemed to be royalty , because the payment made to the parties do not have their PE in India, therefore, by virtue of article 12(7) the same cannot be taxed in India. Regarding programming fee also, he has relied upon the decision of CIT(A) in the order passed under section 201/(201A) dated 17.03.2004. 11. Against the aforesaid finding, the revenue has come in appeal on the ground .....

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Taj India because entire distribution activity in India on behalf of the assessee is being done by the Taj India. In any case, such a distribution income falls within realm of royalty under the provisions of the Income-tax Act, because the distribution involves full/partial transfer of distribution rights which is in the form of copyright and trademark etc. The distribution activity could not have been carried out by the Taj India and the cable operators without the trademark and copyright trans .....

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ted that, now in view of the newly inserted Explanation (vi) by the Finance Act, 2012 with retrospective effect from 01.06.1976, such a payment will fall within the ambit of royalty only. In support of this view, he strongly relied upon the decision of Hon ble Madras High Court in Verizon Communications Singapore Pte Ltd. v ITO, reported in [2014] 361 ITR 575; Tribunal order in Atos Information Technology HK Ltd vs DCIT in ITAT Mumbai Bench in ITA No. 1464/Mum/2015; and also decision of Hon ble .....

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Pte Ltd. (supra) and the decision of Viacom 18 Media Pvt. Ltd, reported in, [2014] 153 ITD 384 wherein, it has been held that since term process used in Article 12(3) of India US DTAA has not been defined, therefore, the same has to be seen in the light of Explanation (vi) brought by way of retrospective amendment which is clarificatory in nature. Thus, he summarized that the income from distribution as well as all the payments are covered under the definition of royalty. 13. Before us, the Ld. .....

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s given in paras 1, 2 & 3. This aspect of the matter has been appreciated by the Ld. CIT(A) also, who has analyzed the terms of the distribution agreement and came to a conclusion that the agreement between assessee and Taj India is on principal to principal basis. In any case, under Article 5(4) of India-Mauritius DTAA the first and foremost condition which needs to be seen that, the agent must habitually exercise the authority to conclude contracts in the name of the assessee or he habitua .....

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The finding given by the ld. CIT (A) in his order at para 2.8 is based on appreciation of facts and also after analyzing the scope and meaning of Article 5(4), therefore, the same should be affirmed. Regarding treatment of distribution revenue as royalty , he submit that there is an inherent contradiction in the finding of the AO, because for the first three months, he is saying that the revenue from distribution would be treated as royalty and post July-2002, when assessee company got incorpora .....

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because it does not get any physical control or possession over the transponder to use it in its own manner. PanAmSat is mainly providing the services to the assessee company through the transponder and the assessee does not receive any knowhow in relation to the secret process of transmitting the signals through transponder. In any case, the payment which has been characterized as a royalty would not be taxable in India, because the transponder fee has been paid by the assessee company to a non .....

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tion (v) and (vi) to section 9(1)(vi) by the Finance Act, 2012 w.r.e.f. 1st April, 1976, he submitted that, first of all the said definition under the Act cannot be read into the Treaty because the definition of royalty in the India-US DTAA has been clearly defined. The enlargement of definition of Royalty under the amended provision of domestic law cannot be imported in Treaty and this view now founds support by a latest decision of Hon ble Delhi High Court in the case of DIT vs. New Skies Sate .....

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. He pointed out that, similar view was upheld by the Tribunal in the case of Dy. Director Income-tax vs B4U International Holdings Ltd., 137 ITD 346. As regards the reliance placed by Madras High Court decision in the case of Verizon Communications Singapore Pte Ltd. (supra) and the ITAT decision in the case of Viacom 18 Media Pvt. Ltd, he submitted that the Hon ble Delhi High Court has taken note of the decision of Hon ble Madras High Court and have discussed the same in detail and did not fol .....

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ourt was materially different and also the term royalty was not defined in the German DTAA. Regarding the decision of ITAT in the case of Atos Information Technology HK Ltd (supra), he submitted that, first of all, this case pertains to HongKong based company wherein there is no DTAA and secondly, the issue involved therein was different. On the decision of ITAT Mumbai in the case of NGC Network (supra), he submitted that in that case matter was set-aside to AO and no final decision was taken by .....

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f making the payment there was no such law, therefore, assessee could not have foreseen such an amendment and deducted the TDS. In support of this contention, he strongly relied upon the ITAT Mumbai in the case of Channel Guide India Ltd. v. ACIT, reported in [2012] 139 ITD 49. Coming to the issue raised in ground no.3, he again reiterated that, the income cannot be distributed under two heads, firstly, as a royalty for the first three months and then as a business income for the balance 9 month .....

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ng decisions:- i) DDIT(IT) v Set India Pvt. Ltd (ITA No.4372/Mum/2004); ii) DDIT(IT) vs. MSM Satellite (Singapore) Pte Ltd.(ITA No.2870/Mum/2010); and iii) MSM Satellite (Singapore) Pte Ltd vs ADIT (IT) (ITA No. 8478/Mum/2011) 16. Lastly, coming to disallowance under section 40(a)(i) for programming was paid to various non-resident, he submitted that this issue is squarely covered in favour of the assessee by the order of the Tribunal in assessee s own case in ITA No. 109/Mum/2008 and ITA No.370 .....

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ing revenue, it has been collecting advertisement revenue and distribution of channel in India. It has appointed Taj India as its advertising sales agent to sell commercial slot/spot to the prospective advertisers and other parties in India in connection with the business of programming and telecasting of Ten Sports Channel. As per the agreement, commission @ 10% of the advertisement revenue was paid to Taj India. The assessee has claimed that, such an income is not taxable in India, because the .....

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of Distribution Agreement dated 1st March, 2002. Under the terms of the distribution agreement, the assessee has appointed Taj India as exclusive distributor in India and prohibits the assessee for entering into distribution agreement with anybody else. The Ld. CIT(A) after taking note of the Distribution Agreement and examining various terms and clauses used therein and also taking into consideration the conduct of the parties, came to the conclusion that, Taj India is not acting as agent of th .....

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distribution business in any manner. This finding of fact of the Ld. CIT(A) is corroborated by the terms and conditions of the distribution agreement as well as sub-distributor agreement as placed in the paper book. Thus, such a finding of fact by the Ld. CIT(A) without there being any rebuttal by way of any contrary material, is affirmed. Even if we independently examine the facts of the case vis-a-vis the provisions contained in Article 5(4) to 5(6) which deals with the agency PE, it can be s .....

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he has and habitually exercises in that first mentioned State, an authority to conclude contracts in the name of the enterprise unless his activities are limited to the purchase of goods or merchandise for the enterprise; or ii. he habitually maintains in that first-mentioned State a stock of goods or merchandise belonging to the enterprise from which he regularly fulfils orders on behalf of the enterprise. 5. An enterprise of a Contracting State shall not be deemed to have a permanent establish .....

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, which is a resident of a Contracting State controls or is controlled by a company which is a resident of the other Contracting State, or which carries on business in that other Contracting State (whether through a permanent establishment or otherwise) shall not, of itself, constitute either company a permanent establishment of the other . Thus, an agent is deemed to be a PE of a foreign enterprise, if he is not independent and has habitually exercises an authority to conclude contracts in the .....

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s or comprehensive control and secondly, he does not bear the entrepreneur risk. It is sufficient for the establishment of an agency PE that the agent has sufficient authority to bind the enterprise s participation in the business activity. Here in this case, none of the conditions as stipulated in Article 5(4) is applicable because Taj India is acting independently qua its distribution rights and the entire agreement ostensibly is on principal to principal basis as analyzed and found by ld. CIT .....

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lowance of various expenses under section 40(a)(i) like, transponder charges and uplinking charges as raised in ground No.2(i) and 2(ii), it is seen that these, payments has been paid to PanAmSat International Systems Inc. USA for providing facility of transponder for telecasting Ten Sports channel in various countries including India. The assessee entered into an agreement with PanAmSat to utilize the transponder facility providing by the said US based company for telecasting its sports channel .....

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sallowance under section 40(a)(i) has been made. The assessee s case before us is that, firstly, PanAmSat is a USA based company, therefore, Indo- US DTAA is applicable and since it does not have any PE or business connection in India, therefore, the payment made to a non-resident outside India for availing service of equipment placed outside India cannot be taxed in India. In support of such a contention decision of Hon ble Bombay High Court in the case of DIT vs. Set Satellite (supra) has been .....

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yalty cannot be taxed in India, because it is not borne by PE or fixed place of the US company in India. The Ld. DR has strongly relied upon amended definition of the royalty under the Act, wherein, the scope and definition of royalty has been enlarged by the newly inserted Explanation (vi) and (vi) by the Finance Act, 2012 with retrospective effect from 01.06.1976 and has contended that the said definition is to be read into DTAA also, that is, the definition of royalty has to be taken from the .....

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or the use of or the right to use, any copyright of a literary, artistic, or scientific work, including cinematograph films or work on film, tape or other means of reproduction for use in connection with radio or television broadcasting, any patent, trade mark, design or model, plan, secret formula or process, or for information concerning industrial, commercial or scientific experience, including gains derived from the alienation of any such right or property which are contingent on the product .....

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ne and no definition under the domestic Act or law is required to be considered or seen or any amendment made in such definition whether retrospective or prospective which can be read in a manner so as to extend any operation to the terms as defined or understood in the Treaty. The Legislature or Parliament while carrying out amendment to interpret or define a given provision under the Domestic Law of the country cannot supersede or control the meaning of the word which has been expressly define .....

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mark, design, secret formula or process. It is also not use or right to use any industrial, commercial, or scientific equipment. There is no such kind of right to use which is given by Pan Am Sat to asessee. Thus, the said payment does not fall within the ambit of the terms used in para 3 of Article 12. So far as the reading of amended definition of royalty as given in section 9(1)(vi) into treaty, Hon ble Delhi High Court in its latest judgment in the case of DIT vs. New Skies Satellite(supra), .....

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e absence of any contouring explanations), will continue to hold the filed for the purpose of assessment years preceding the Finance Act, 2012 and in all cases which involve a Double Tax Avoidance Agreement, unless the said DTAAs are amended jointly by both partners to incorporate income from data transmission services as partaking of the nature of royalty, or amend the definition in a manner so that such income automatically becomes royalty. It is reiterated that the Court has not returned a fi .....

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adras High Court in Verizon Communications Singapore Pte Ltd. V. The Income Tax Officer, International Taxation I, [2014] 361 ITR 575 (Mad), the Court held the Explanations to be applicable to not only the domestic definition but also carried them to influence the meaning of royalty under Article 12. Notably, in both cases, the clarificatory nature of the amendment was not questioned, but was instead applied squarely to assessment years predating the amendment. The crucial difference between the .....

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20. Otherwise also, now it is quite trite position that, at the time of making the payment when there is no amendment in the statute, then assessee cannot be expected to withhold the tax, especially when under the old provision or by virtue of any judicial precedent such payment does not fall or has been held to be not falling within the ambit and scope of royalty . In these kinds of cases there were various decisions including that of the Hon ble Bombay High Court in the case of CIT vs. Set Sa .....

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that is, the law of the possibly compelling a person to do something which is impossible, that is, when there is no provision for taxing an amount in India then how it can be expected that a tax should be deducted on such a payment. This view has been upheld by in catena of decisions including the ITAT Mumbai Benches in the case of Channel Guide India Ltd (supra) wherein, it has been held that, assessee cannot held to be liable for deducting TDS in view of the retrospective amendment which has c .....

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d taken by the AO that for three months the payment will constitute royalty and for balance nine months, the payment will constitute business income . It has also been brought to our knowledge that in the subsequent years the AO has treated distribution income as business income and not as royalty. Thus, prior to period 12th July, 2002, also when assessee was not registered under the Laws of Mauritius then also it will not affect the nature of income. In any case, as stated earlier, under the di .....

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first period 01.04.2002 to 12th July, 2002 the said income will not constitute royalty . 22. So far as the reliance placed by the Ld. DR on the decision of ITAT Mumbai Bench in the case of NGC Network (supra), we find that in that case the issue of distribution income was set aside to the file of the AO to examine whether it falls within the ambit of royalty as defined under the Income-tax Act or not. Here in this case, as pointed out by the Ld. Sr. Counsel, the AO himself has treated the incom .....

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er dated 18.05.2012. In these cases, the Tribunal has relied upon a decision of Set Satellite (132 TTJ 459) which decision has now been affirmed and approved by the Hon ble Bombay High Court in the case of DIT vs Set Satellite Singapore Pte Ltd (supra) on the ground that, the programming cost is paid to the assessee to various nonresident outside India for acquiring right brought on sports events taking place outside India. Thus, such programming cost cannot be deemed to arise in India as liabil .....

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he case and in law, the Ld. CIT(A) erred in holding that Taj India does not constitute an agency PE of the assessee within the meaning of Article 5(4) of the DTAA with regard to the distribution income received by it. 2.(i) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting disallowances made by the Assessing Officer u/s.40(a)(i) of the I.T. Act in respect of claims of transponder charges expenses amounting to US$ 1,87,328 and uplinking charges of US $ .....

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. 4. The appellant craves leave to amend or alter any ground or add a new ground which may be necessary . (Assessment year: 2005-06): 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that Taj India does not constitute an agency PE of the assessee within the meaning of Article 5(4) of the DTAA with regard to the distribution income received by it. 2.(i) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting di .....

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ccordingly tax should have been deducted at source on such expenses. 3(i). On the facts and in the circumstances of the case and in law the Ld. CIT(A) erred in holding that payment of programming fees in respect of live progammes does not constitute Royalty as provided under Article 12 of the DTAA between India and Mauritious. 3(ii) On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that programming fee in respect of live programming even if taken as ro .....

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decided by us herein above for the AY 2003-04, which will apply mutatis mutandis to impugned appeals of the revenue also as the same facts are permeating in these years also. Accordingly, both the appeals of the revenue stands dismissed. 27. Now, we shall take up assessee s appeals being ITA No. 5537 of 2008; ITA No. 5536 of 2008 and ITA No.4706 of 2009 for AYs 2003-04, 2004-05 and 2005-06 respectively. In all these year, the assessee has raised identical grounds, thus we take-up grounds for AY .....

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the assessee contended and stated as under:- With reference to the captioned subject, Taj submits as under:- Taj has received an order passed by Honorable Commissioner of Income Tax (Appeals)-)XXXI [(A)'], pertaining to AY 2003-04 on 26.02.2007 In this regard, we state that the Deputy Director of Income Tax (International Taxation) -2(1) Mumbai, (DDIT) has preferred an appeal against the said CIT (A) order. The copy of Form 36 filed by the income-tax Department is attached herewith for your .....

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tanley & Co Inc (2007) 79 lTD 417 (Supreme Court) • Galileo International Inc. V DCIT (2008) 19 SOT 257 (Delhi Tribunal) • Amadeus Global Travel Distribution S A Vs DCIT, Delhi (2008) TA Nos. 2143, 2144 & 2145 IDeII2000 (Unreported) In the aforesaid judicial pronouncements, the Honorable Apex Court / Honorable Tribunal had observed as under: "… the said ruling equates an arm's length analysis (ALA) with attribution of profits. It holds that once a transfer prici .....

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nd:- The DDIT had held that Taj is having PE in India and without considering the Circular No. 23 based on Arm's length principle, it has held that Taj's income is liable to tax in India. Now, in view of the aforesaid judicial pronouncements on the subject matter relevant to the facts of the Taj, Taj humbly prays to your Honor to admit an appeal to consider the submission while dealing with the appeal filed by the income-tax department for the same assessment year. Taj further submits th .....

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