The Tax Publishers2020 TaxPub(DT) 4214 (SC) : (2020) 272 TAXMAN 0101

INCOME TAX ACT, 1961

Section 261 Section 194C Section 194J

Where the department preferred SLP to appeal against the judgment of Bombay High Court in CIT v. Zoom Entertainment Network Ltd. [ITA Nos. 1407 & 1408 of 2016, Order dated 3-1-2018 : 2021 TaxPub(DT) 413 (Bom-HC), whereby the High Court held that as decided in CIT v. UTV Entertainment Television Ltd. (2017) (10) TMI 1341, placement fees were paid under the contract between the respondent and the cable operators, therefore, by no stretch of imagination, considering the nature of transaction the argument of assessee that carriage fees or placement fees were in the nature of conversion of royalty, can be accepted. Therefore, activities of assessee were covered by section 194C, the Supreme Court considering the fact that revenue sought to withdraw SLP due to low tax effect, dismissed the SLP as withdrawn, leaving question of law open.

Appeal (Supreme Court) - Special leave petition - Tax deduction at source - Placement fees/carriage fees paid to cable operators/MSO/DTH operators--Payments for work contract under section 194J or fees for technical service under section 194C

Department preferred SLP to appeal against the judgment of Bombay High Court in CIT v. Zoom Entertainment Network Ltd. [ITA Nos. 1407 & 1408 of 2016, Order dated 3-1-2018 : 2021 TaxPub(DT) 413 (Bom-HC), whereby the High Court held that as decided in CIT v. UTV Entertainment Television Ltd. (2017) (10) TMI 1341, placement fees were paid under the contract between the respondent and the cable operators. therefore, by no stretch of imagination, considering the nature of transaction the argument of assessee that carriage fees or placement fees were in the nature of conversion of royalty, can be accepted. Therefore, activities of assessee were covered by section 194C. Held: The Supreme Court considering the fact that revenue sought to withdraw SLP due to low tax effect, dismissed the SLP as withdrawn, leaving question(s) of law open.

REFERRED :

FAVOUR : SLP dismissed as withdrawn.

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