CIT vs. Delhi Race Club (Delhi High Court)

DATE: November 18, 2014 (Date of pronouncement)
DATE: December 2, 2014 (Date of publication)
AY: 2007-08, 2009-10
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S. 9(1)(vi): Broadcast or live coverage does not have a "copyright" & is consequently not assessable as "royalty" for purposes of TDS

(i) A live T.V coverage of any event is a communication of visual images to the public and would fall within the definition of the word “broadcast” in Section 2(dd). That apart we note that Section 13 does not contemplate broadcast as a work in which “copyright” subsists as the said Section contemplates “copyright” to subsist in literary, dramatic, musical and artistic work, cinematograph films and sound recording. Similar is the provision of Section 14 of the Copyright Act which stipulates the exclusive right to do certain acts. A reading of Section 14 would reveal that „copyright‟ means exclusive right to reproduce, issue copies, translate, adapt etc. of a work which is already existing.

(ii) Adverting to the facts of this case we note that the assessee was engaged in the business of conducting horse races and derived income from betting, commission, entry fee etc. and had made payment to other centres whose races were displayed in Delhi. It is not known whether such races had any commentary or analysis of the event simultaneously. It is not the case of the Revenue that the live broadcast recorded for rebroadcast purposes. Having held that the broadcast/live telecast is not a work within the definition of 2(y) of the Copyright Act and also that broadcast/ live telecast doesn’t fall within the ambit of Section 13 of the Copyright Act, it would suffice to state that a live telecast/broadcast would have no “copyright”. This issue is well settled in view of the position of law as laid down by this Court in ESPN Star Sports vs. Global Broadcast News Ltd. & Ors. reported as 2012 2 RAF 430 (Delhi),, wherein this Court after analysing the provisions of the Copyright Act was of the view that legislature itself by terming broadcast rights as those akin to “copyright” clearly brought out the distinction between two rights in Copyright Act, 1957. According to the Court, it was a clear manifestation of legislative intent to treat copyright and broadcasting reproduction rights as distinct and separate rights. It also held that the amendment of the Act in 1994 not only extended such rights to all broadcasting organizations but also clearly crystallized the nature of such rights. The Court did not accept the contention of the respondent that the two rights are not mutually exclusive by holding that the two rights though akin are nevertheless separate and distinct.

(iii) In view of the aforesaid position of law which brought out a distinction between a copyright and broadcast right, suffice would it be to state that the broadcast or the live coverage does not have a “copyright”. The aforesaid would meet the submission of Mr.Sawhney that the word “Copyright” would encompass all categories of work including musical, dramatic, etc. and also his submission that the Copyright Act acknowledges the broadcast right as a right similar to “copyright”. In view of the conclusion of this Court in ESPN Star Sports case, such a submission need to be rejected (DIT vs. Neo Sports Broadcast (P) Ltd. 133 ITD 468 (Mumbai) approved)

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