Sports Broadcasting Fees for Live Feed Not Taxable as Royalty: Delhi High Court

CIT – International Taxation Vs Fox Network Group Singapore PTE Ltd. (Delhi High Court)

Introduction: The Delhi High Court recently delivered a judgment in the case of CIT – International Taxation vs. Fox Network Group Singapore PTE Ltd., addressing the classification of fees received for live transmission under Section 9(1)(vi) of the Income Tax Act, 1961. The court’s decision is detailed in the full text of the judgment/order dated [Date].

Background: The appeal, filed by the Revenue, challenged the decisions of the Income Tax Appellate Tribunal (ITAT) for Assessment Years 2015-16 and 2014-15. The respondent assessee, Fox Network Group Singapore PTE Ltd., entered into a Novation Agreement in 2014 with ESS Singapore and Star India Private Limited. The agreement encompassed various aspects, including distribution of channels, advertisement sales, and license agreements.

Condoning Delay: The court addressed a delay of 480 days in refiling the appeal, and considering the disclosures made, condoned the delay, leading to the disposal of the application.

Key Findings: The central question was whether fees received for live transmission, specifically ‘live feed’ of sports broadcasting rights, could be classified as royalty income under Section 9(1)(vi) of the Act. The respondent contended that only the income from ‘non live’ feed should be considered as royalty.

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