The assessee, a Singapore-based company, entered into a licensing arrangement to sublicense sports broadcasting rights of live feeds to an Indian company. It claimed that the income related to live feed was not taxable as royalty under either Section 9(1)(vi) of the Act or the India-Singapore DTAA, arguing that live telecasts do not involve transfer of copyright. The Assessing Officer disagreed and taxed the entire license fee as royalty, treating live transmission as a “process” covered under Explanation 6 to Section 9(1)(vi).

The Court ruled that live telecasts are not “works” under the Copyright Act and therefore cannot attract copyright-based royalty taxation. It also held that Explanation 6, which deems transmission to be a “process,” was inapplicable since the actual transmission was carried out by the Indian Company and not the assessee. Furthermore, the Court emphasized that domestic law cannot override DTAA provisions, and the payment for live feed did not qualify as royalty under the treaty. Thus, the income was not taxable in India.(AY. 2015-16)