Case Law Details
ESPN Digital Media (India) Pvt. Ltd Vs DCIT (ITAT Chennai)
ITAT held that the consideration paid by ESPN India for purchase of advertisement space was not taxable during the period under consideration. The consideration paid by ESPN India is not for ‘use’ of equipment (server) or for any process nor imparting of any information concerning technical, industrial, commercial, or scientific knowledge, experience or skill. Further, no right has been conferred on ESPN India over the server or website belonging to ESPN UK and ESPN India is merely a reseller of advertisement space it purchases on ESPN UK’s website. Further, the reliance of the AO and CIT(A) on the unilateral retrospective amendments to section 9(1)(vi) of the Act to the definition of ‘royalty’ cannot override the more beneficial definition under Article 13(3) of the UK-India Tax Treaty.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
These four appeals by the assessee are arising out of different orders of Learned Commissioner of Income Tax Appeals)-16, Chennai in ITA Nos.295/CIT(A)-16/2010-11, 294/CIT(A)-16/2012-12, 293/CIT(A)-16/2012-13 & 296/CIT(A)-16/2013-14 vide orders of even date 31.01.2018. The assessments were framed by the DCIT, International Taxation 1(1), Chennai u/s. 201(1)/(1A) of the Income Tax Act, 1961 (hereinafter ‘the Act’) vide orders of even date 04.11.2016 for the assessment years 2010-11, 2011-12, 2012-13 & 2013-14.
2. The only common issue in these four appeals of assessee is as regards to the order of CIT(A) confirming the action of AO in holding the payments made by ESPN India constitutes ‘royalty’ falling u/s.9(1)(vi) of the Act and thereby, treating the assessee as ‘assessee in default’ for non-deduction of tax at source u/s.201(1) & 201(1A) of the Act. For this, assessee has raised exactly identically worded grounds in all the four years. The issue and facts, as conceded by both the sides, are exactly same, except the quantum. As the facts are identical in all the four assessment years and issue is exactly one, we will take the facts from assessment year 2010-11 in ITA No.1070/Chny/2018 and will decide the issue. The relevant grounds Nos.2.1 to 2.14 read as under:-
Please become a Premium member. If you are already a Premium member, login here to access the full content.
