Case Law Details
Brief of the Case
ITAT Mumbai held In the case of Zee Media Corporation Limited vs. DCIT that regarding the nature of the news items purchased, we find it is in the common knowledge of every citizen that the news items do not have enduring benefit. Normally, the news items/non fictional items purchased by the assessee lose its value once they are telecast. Therefore, such items do not have repeat telecast value in terms of the revenue generation by way of advertisement from the sponsors. As such, it is a settled issue at the level of Hon‟ble Delhi High Court in the case of Television Eighteen India Ltd. [2014] 364 ITR 597 (Delhi), that the claims of the assessee relating to news / non-fictional items are allowable.
Regarding the nature of TV programs / Film rights, assessee amortised the inventories as per the method of accounting consistently followed by him over the years. In fact, the Revenue has consistently allowed the claim in the past. This is for the first time, AO disturbed the claim of the assessee and invoked the provisions of section 32 (ii) without any sustainable reasoning. We find similar issue of amortization of the TV Programs/Film rights came up before the Chennai Bench of the Tribunal in the case of M/s. Sun TV Networks Ltd in ITA Nos.1515 to 1520/Mds/2013 wherein the issue was decided in favour of the assessee and rejected the AO’s proposal to invoke the provisions of section 32(ii) in respect of the above programs/rights.
Facts of the Case
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