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Judgment
Per Renu Jauhri, Accountant Member:
The above captioned appeal is preferred by the assessee against the order dated 30.10.2025, passed by CIT(A)-42, Delhi u/s 250 of the Inco me Tax Act, 1961 (hereinafter referred to as “the Act”) for A.Y . 2024-25.
The assessee has raised the following ground s of appeal:
Ge neral
“1 . On the facts and i n t he cir cums tances of t he case and i n la w, the Hon’ble C IT(A ) err ed i n treati ng the distribution i ncome of Rs. 2,55,08,850 taxabl e as Royalty and thereby t axes of Rs. 38,26,327 deposited thereon is collected exc essively i n vi olati on of the provisions of the A ct.
Distribution fee received for granting r ights for distribution o f TV channel does not constitute ‘Roy alty’ under the India-UK Double Tax ation Avoi da nce A greement (‘DTAA’)
2.On the facts and i n t he cir cums tances of t he case and i n law, the l earne d CIT (A) err ed i n rej ecti ng the applicatio n for c ondonation of delay in filing the appeal under section 246A of t he Act.
3.On the facts and i n t he cir cums tances of t he case and i n law, the l earne d CIT (A) err ed i n rej ecti ng the fres h claim mere ly bec aus e it wa s not made i n the ret urn of income, despite havi ng plenary appellate powers and the settled pri nciple that ther e is no estoppel in law to make a legitimate cl aim eve n if it res ul ts i n i nc ome lower tha n the r eturned i nc ome.
4.On the facts and i n t he cir cums tances of t he case and i n law, the learned CIT(A) has er red i n not adj udicati ng o n the Appella nt’s contenti on that the distribution fee of INR 2,55,08,846 earned fo r granti ng distribution ri ghts in r elati on to the TV channel (BB C Ne ws) does not fal l wi thi n the definition of “R oyalty” under s ecti on 9(i )(vi ) of the Act or Article 13 of the Indi a-UK DTAA, and accor di ngl y, is not c hargeabl e t o t ax in India.
5.On the facts and i n t he cir cums tances of t he case and i n law, the learned CIT(A ) erred in not direc ting the Ld. AO to gr ant refund of INR 38,2 6,327, bei ng the tax deducted at source on the distribution fee ear ne d by the Appellant during the rel evant year.”
The sole substantive issue involved in this appeal is regarding the taxability of distribution fee of Rs.2,55,08,846/-earned by the assessee for granting distribution rights o f BBC News C hannel.
Brief facts related to this issue are that the asse ssee itself had offered distribution fee received of Rs.2,55,08,846/- as taxable in its hands as “Royalty” while filing its return for A.Y. 2014-15 and TDS @15% as per Article 13 of India-UK DTAA was also deducted. The CPC, w hile processing the return u/s 143(1) accepted the returned inco me without making any adjustment. However subsequently, in assessee’s own case for A.Y s. 2006-07, 2007-08 & 2008-09, the issue was decided in favour of the assessee by the IT AT as well as the Hon’ble High Cour t. T his led the assessee to file an appeal before ld. CIT(A) against section 143(1) order belatedly raising this ground for the first time. The assessee also applied for condonation of delay before the ld. CIT(A) on the ground that the impugned amount was sho wn in income adopting a conservative approach as there was lack of clarity on taxability of TV channel distribution fees till the matter was finally decided in assessee’s favour by the Hon’ble High Court. Ld. CIT(A) however, did no t condone the delay and dismissed the appeal in limine. Ld. CIT(A) observed in her order that the reasons of delay given by the assessee are no t bonafide as it filed the return for A.Y . 2024-25 much after the favour able decision of ITAT in earlier years and still declared the impugned amount as income in the return. Fur ther, she held that co ndonation would cause serio us prejud ice to the interests of revenue as the AO cannot examine and verify the claim and moreover no adjustment was made by the CPC while passing order u/s 143(1) and therefore the issue fell o utside the sco pe of appeal. Fur ther aggrieved, the assessee is in appeal before the Tribunal.
We have heard the rival submissions and perused the material placed on record as well as the relevant judicial pronouncements. After careful consideration of the facts and circumstances as well as var ious decisions and the CBDT circular dated 11 .04.1955 stating that only legitimate tax must be assessed and collected, relied upon by the ld. AR. Although this claim has been raised for the first time before the appellate authority, in the inte rest of justice , we deem it appropriate to restore the matter to Ld. J.A.O. for denovo consideration and to decide the issue on merits after giving due opportunity of being heard to the assessee.
In the result, the assessee’s appeal is allo wed for statistical purposes.