1. This Appeal challenges the order passed by the Income Tax Appellate Tribunal, Mumbai Bench delivered in a batch of Appeals on 25th June 2010.
2. Mr.Tejveer Singh, learned Advocate in support of this Appeal submitted that some time may be given only to study the impact of this order of the Tribunal on other pending cases. He submits that if the present Appeal is considered by this Court in the backdrop of the facts and circumstances peculiar to it, the order passed by this Court may affect large number of cases and proceedings in which similar issue may be involved.
3. First of all, we do not appreciate such requests because the matters are notified for admission well in advance. We expect counsel appearing for the Revenue and the assessee, both to be ready with the arguments so that the Court's time is not wasted. Secondly, in the view that we are taking and based on the facts peculiar to the case of the present assessee, we do not think that our order of such nature can have any impact on pending cases as apprehended and which may or may not involve similar issues. Ultimately, in the peculiar facts of this case and when we have granted adjournments in the past, we do not think that any further time deserves to be granted. The request is refused.
4. Mr.Tejveer Singh then submitted that the two substantial questions of law are that the payment to one Global Cricket Corporation Private Limited for acquisition of telecast rights are in the nature of "royalty" covered by explanation 2 under section 9(1)(vi)(c) of the Income Tax Act, 1961 and the further question that assuming it is in the nature of a royalty, yet the Article 12(7) of the Double Taxation Avoidance Agrement would denote that the payment is not chargeable to tax in India. Mr.Singh submits that these are two substantial questions of law and which directly emerge from the order passed by the Income Tax Appellate Tribunal.
5. We are unable to agree. The concurrent finding and on fact, is that the assessee is a Singapore based company engaged in the business of acquiring rights in television programmes, motion pictures and sports events and exhibiting the same on its television channels from Singapore. The assessee is a tax resident of Singapore. The assessee entered into an agreement on 25th January 2002 with Global Cricket Corporation Private Limited (GCC), also a tax resident of Singapore. It is that agreement under which the GCC granted rights to the assessee and throughout the licence territory. The licence territory, inter alia, and as defined referred to, and included India.
6. The proceedings were initiated so as to bring the payment within the tax law and namely, the Income Tax Act, 1961. The allegation was that the tax was not deducted at source from the payments made to Global Cricket Corporation.
7. Both the Commissioner of Income Tax (Appeals) as also the Tribunal held that if the underlying facts noted by us hereinabove are not in dispute, then, the payment for the cricket rights is made only for broadcasting operations of the assessee which are carried out from Singapore. The liability for the payment is incurred by the assessee in connection with the broadcasting operations in Singapore. That has no connection with the marketing activities carried out through its alleged permanent establishment in India. It is in these circumstances that we are of the view that the finding of fact that in the present case there is no economic link between the payments assuming that they are in the nature of royalties made out of India cannot be termed as perverse. Then, the Revenue stand cannot be upheld. Even with regard to the alleged permanent establishment of the assessee in India, the Tribunal's finding of fact is that the economic link is entirely with the assessee's head office in Singapore. The payment to GCC cannot be said to have been incurred in connection with the appellant's permanent establishment in India. Such a finding of fact and which is re-affirmed in paragraph no.20 cannot raise any substantial question of law. The finding of fact is that the payer is not a resident of India. Secondly, the liability to pay royalty has not been incurred in connection with and is not borne by the permanent establishment of the payer in India. The absence of economic link is thus the foundation on which the Tribunal's conclusions are based. These are essentially factual conclusions. They are peculiar to the facts and circumstances of the case of the assessee before the Tribunal and before us. There has been no general rule laid down nor can the Tribunal's order be seen as having any impact or repercussion on cases pending before the authorities or before the Tribunal. We have no doubt in our mind that the conclusion reached is possible, given the nature of the agreement between the payer and the Singapore party, the economic link has been traced from the transactions and which has been the subject matter of the agreement. In these circumstances, none of the apprehensions of Mr.Tejveer Singh can enable us to entertain this appeal. Once it does not raise any substantial question of law, then, the Appeal deserves to be dismissed. It is also dismissed because the view taken by the Tribunal in the given facts and circumstances cannot be said to be perverse or based on no material. It also cannot be said to be based on irrelevant and non-germane consideration and materials either.
8. The Appeal is thus dismissed. No costs.