TMI Blog1973 (3) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... 961. The petitioner No. 1 is a company incorporated under the English Companies Act in London with its registered office at Copyright House, 33, Margaret Street, Cavendish Square, in the County of London, England. The petitioner No. 1 is a non-profit making body and renders public service. The petitioner No. 2 is a private limited company incorporated under the Companies Act having its office at 26, Chowringhee Road, Calcutta. The petitioner No. 2 was appointed by the society as its true and lawful attorney. By virtue of power of attorney granted by the said society to petitioner No. 2, the Natsin India Pvt. Ltd., the latter company are agents in India for the Performing Right Society and has the power to commence, prosecute, etc. The petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (iv) the title of each work ; (v) the names of the respective composers, authors, arrangers and publishers and also (where gramophone records are used) the name of the manufacturer and identification number of each record, together with such further details as will enable the society to identify the work for the purpose of distribution of fees, such lists to be certified by the licensee as correct. It was also agreed that the licensee will pay at the rate of pound 2 (two pounds) per hour of broadcasting western music from each of the licensee's main and external service stations and such annual payment must be paid by the All India Radio to the society in London. The petitioner filed an income-tax return before the local Income-tax Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alties. Therefore, the question is whether such royalty is assessable as income in India. For the purpose of this case sections 5 and 9 of the Income-tax Act will be relevant and which run as follows : " 5. Scope of total income.- (1) Subject to the provisions of this Act, the total income of any previous year of a person who is a resident includes all income from whatever source derived which (a) is received or is deemed to be received in India in such year by or on behalf of such person ; or (b) accrues or arises or is deemed to accrue or arise to him in India during such year ; or (c) accrues or arises to him outside India during such year : Provided that, in the case of a person not ordinarily resident in India within the mean ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lent at interest and brought into India in cash or in kind or through the transfer of a capital asset situate in India ; Explanation.-For the purposes of this clause-(a) in the case of a business of which all the operations are not carried out in India, the income of the business deemed under this clause to accrue or arise in India shall be only such part of the income as is reasonably attributable to the operation carried out in India ; (b) in the case of a non-resident, no income shall be deemed to accrue or arise in India to him through or from operations which are confined to the purchase of goods in India for the purpose of export ; (ii) income which falls under the head 'Salaries ' if it is earned in India ; (iii) income cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ia Radio in London. Mr. Dutta contended that as the royalty was received in London it is not assessable by the income-tax authority in India, while Mr. Balai Pal on behalf of the respondent contended that the emphasis is not on the source upon which income-tax is to be assessed but it is necessary to see where the income accrues and, therefore, the income is taxable under the Income-tax Act. In my opinion, Mr. Pal is right in his contention and the contention raised is also supported by the judgment of the Privy Council in Rhodesia Metals Ltd. v. Commissioner of Taxes. At page 52, the judicial Committee observed that " source " means not a legal concept but which a practical man would regard as a real source of income. The case, Rhodesia ..... X X X X Extracts X X X X X X X X Extracts X X X X
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