TIMES GLOBAL BROADCASTING COMPANY LTD ,MUMBAI vs. THE ACIT CIRCLE 16(1) , MUMBAI

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ITA 1487/MUM/2021Status: DisposedITAT Mumbai19 October 2026AY 2016-1728 pages

In favour of the assessee: the assessee's appeal was allowed. From the AI summary of this appeal.

AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the references made by the Assessing Officer to the Transfer Pricing Officer under Section 92CA(1) for Assessment Years 2015-16 and 2016-17 were invalid. The Tribunal reasoned that these references were made after the omission of clause (i) of Section 92BA of the Income-tax Act, 1961, and the subscription-fee payments in question fell solely within the ambit of the omitted clause. The Tribunal followed the decisions of coordinate benches in Yorkn Tech Pvt. Ltd. and Infrastructure Leasing and Financial Services Ltd., which had directly addressed similar situations where references were initiated after the omission of Section 92BA(i) for transactions that fell under that clause. The Tribunal distinguished the case of Dixon Technologies, which involved a pre-omission TPO determination. Consequently, the Tribunal directed the deletion of the transfer-pricing adjustments of ₹5,93,01,029 for Assessment Year 2015-16 and ₹9,22,52,862 for Assessment Year 2016-17. The alternative grounds on the merits of the transfer pricing adjustments and procedural grounds under Sections 144C and 153 were left undecided as the primary jurisdictional issue was decided in favour of the assessee, granting effective relief.

What were the facts?

The assessee, Times Global Broadcasting Company Limited (TGB), filed appeals against final assessment orders for Assessment Years 2015-16 and 2016-17. The appeals challenged transfer-pricing adjustments made by the Assessing Officer (AO) concerning subscription-fee payments to associated enterprises (AEs). A key issue was the validity of references made by the AO to the Transfer Pricing Officer (TPO) under Section 92CA(1) after clause (i) of Section 92BA was omitted from the Income-tax Act, 1961, effective April 1, 2017. The assessee also disputed the TPO's allocation of employee and Key Managerial Personnel (KMP) costs, exclusion of support-services revenue, and the resulting adjustments. For AY 2016-17, procedural objections regarding Section 144C and Section 153 were also raised. The AO's references were made on December 20, 2017 (AY 2015-16) and November 29, 2018 (AY 2016-17), after the omission of Section 92BA(i).

What were the issues?

1. Whether the references made by the Assessing Officer to the Transfer Pricing Officer under Section 92CA(1) of the Income-tax Act, 1961, for specified domestic transactions (SDT) are valid, given that clause (i) of Section 92BA was omitted with effect from April 1, 2017, and the references were made thereafter for Assessment Years 2015-16 and 2016-17. Assessee's Contentions: - The references made after the omission of Section 92BA(i) are invalid, as the specific category of transaction (subscription fees to AEs) under which the references were made ceased to exist. - The omission of Section 92BA(i) extinguished the authority to initiate proceedings under that clause for transactions occurring before the omission but referred after it. - Relied on decisions in Yorkn Tech Pvt. Ltd. and Infrastructure Leasing and Financial Services Ltd. Revenue's Contentions: - The references are valid as they pertain to transactions that occurred during the period when Section 92BA(i) was in force. - Section 6 of the General Clauses Act preserves the operation of previous enactments and allows subsequent institution of proceedings in respect of matters so preserved. - Argued that Section 92(2A), read with the former Section 92BA(i), imposed an arm’s-length computation requirement for the relevant assessment years.

Which sections of the Income-tax Act were involved?

Section 92CA,Section 92BA,Section 144C,Section 153,Section 40A(2)(a),Section 92(2A)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘J’ BENCH

Before: SHRI AMIT SHUKLA & SHRI G.M. DOSS

For Appellant: Shri P.J. Pardiwala a/w. Shri
For Respondent: Shri Praveen Salunkhe
Hearing: 05/10/2026Pronounced: 19/10/2026

आदेश / O R D E R PER AMIT SHUKLA (J.M): The aforesaid appeals have been filed by Times Global Broadcasting Company Limited (“TGB” or “the assessee”) filed against final assessment orders 30.01.2020 passed in pursuance to the directions dated 10.12.2019, by the Dispute

2 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., Resolution Panel (“DRP”) for the Assessment Years 2015–16 and 2016–17 and mainly concern with transfer-pricing adjustments made in respect of subscription-fee payments to the assessee’s associated enterprises (“AEs”). The common jurisdictional challenge is to the references made by the Assessing Officer (“AO”) to the Transfer Pricing Officer (“TPO”) for specified domestic transaction (SDT) under Section 92CA(1) of the Income-tax Act, 1961 (“the Act”), after clause (i) of Section 92BA was omitted with effect from 1 April 2017. The assessee also challenges, without prejudice, the TPO’s allocation of employee and Key Managerial Personnel (“KMP”) costs, the exclusion of corresponding support-services revenue, the resulting segmental margins and the quantum of the adjustments in his order dated 15.10.2018. For Assessment Year 2016–17, the grounds further raise objections concerning the procedure followed under Section 144C and the limitation period under Section 153 of the Act.

2.

Brief facts are that, TGB is engaged, inter alia, in distribution of television channels and provision of support services to group entities. It is a wholly owned subsidiary of Bennett, Coleman & Company Limited (“BCCL”). Under a distribution agreement dated 1 April 2014, TGB was

3 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., appointed the sole and exclusive distributor of six television channels belonging to BCCL and Zee Entertainment Networks Limited (“ZENL”). In carrying out the distribution activity, TGB collected subscription fees from cable operators, multi- system operators and direct-to-home service providers, remitted the relevant amounts to the channel-owning AEs and retained a distribution service fee. Separately, TGB provided support services to its AEs and recovered the relevant employee costs with a mark-up of 10%. The subscription-fee payments were reported in Form 3CEB as specified domestic transactions and as payments to persons covered by Section 40A(2)(b) of the Act. For transfer-pricing purposes, TGB benchmarked the distribution activity by applying the Transactional Net Margin Method (“TNMM”). Although the assessee treated distribution as a distinct segment for benchmarking, its audited financial statements reported a single segment under the applicable accounting standard.

3.

For Assessment Year 2015–16, TGB paid subscription fees of ₹49,18,63,815: ₹39,45,19,068 to BCCL and ₹9,73,44,746 to ZENL. In its transfer-pricing study, the assessee reported a distribution-segment operating margin of 1.59% and selected comparable companies with margins ranging from –0.05% to 1.77%, with a median of 0.23%. During the assessment proceedings, the AO sought approval

4 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., from the Principal Commissioner of Income-tax on 30 November 2017 to refer the matter to the TPO; approval was obtained on 18 December 2017, and the reference under Section 92CA(1) was made on 20 December 2017. The stated reason for the reference was that the case had been selected under CASS for “Large specified domestic transaction(s)”. For Assessment Year 2016–17, the reference under Section 92CA(1) was made on 29 November 2018, again on the stated CASS reason of “Large specified domestic transaction(s)”.

4.

In his order under Section 92CA(3) dated 15th October 2018 for Assessment Year 2015–16, the TPO did not accept the assessee’s segmental cost allocation. The assessee had furnished division-wise employee records identifying 28 employees as engaged in distribution and the remaining employees as engaged in support services. The TPO considered, however, that the details initially furnished did not adequately establish the designations, duties, remuneration and actual deployment of those employees for the purpose of determining the segmental profit. He noted that, apart from one appointment letter, the material did not provide the particulars he considered necessary to justify excluding the relevant salaries and benefits from the distribution segment’s costs. The TPO also referred to the related-party disclosures identifying the Managing Director

5 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., and Chief Executive Officer, the Chief Financial Officer and company secretaries as KMP, and observed that those personnel did not appear on the list of employees assigned to distribution. In his view, it was unlikely that the KMP had no involvement in the distribution activity and the assessee had not justified excluding their remuneration from the segmental computation.

5.

In the absence of what he considered sufficient employee- wise evidence, the TPO allocated the total employee-benefit cost of ₹60,96,76,344 between the distribution and support- services segments in the ratio of their revenues, approximately 45:55. He also allocated depreciation and amortisation by reference to revenue. This method assigned ₹27,43,54,355 of employee-benefit expense to distribution. On that basis, the TPO computed distribution-segment operating expenses of ₹80,49,04,800 against operating revenue of ₹53,91,00,265, resulting in an operating loss of ₹26,58,04,535 and a margin of –49.30%. Comparing that margin with the lower end of the assessee’s comparable- company range, namely –0.05%, the TPO determined an adjustment of ₹26,55,06,880 in respect of the subscription- fee transaction. The original TPO order dated 15 October 2018 also proposed a separate adjustment relating to liabilities in a demerger. The assessee challenged both adjustments before the Hon’ble Bombay High Court. By order

6 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., dated 15 March 2019 in Writ Petition No. 3386 of 2018, the High Court granted relief in respect of the demerger-related adjustment, but did not disturb the adjustment concerning subscription fees. The TPO thereafter passed a consequential order dated 9 April 2019 retaining the subscription-fee adjustment of ₹26,55,06,880.

6.

The DRP examined the assessee’s further material concerning the allocation of employee costs for Assessment Year 2015–16 and called for a remand report. Before the DRP, the assessee furnished employment letters and employee-wise cost details for the 28 employees identified as engaged in distribution, showing an actual cost of ₹4,59,63,810. In his remand report dated 27 August 2019, the TPO accepted the actual cost attributable to those employees. He nevertheless maintained that the KMP costs were common costs requiring allocation between the two segments. The total KMP cost considered in the remand exercise was ₹4,58,35,323, of which ₹2,06,25,895 was allocated to distribution by applying the revenue ratio. The TPO continued to exclude from the distribution-segment computation the corresponding support- services revenue recovered from the same AEs on a cost-plus- 10% basis. The DRP accepted the actual employee-cost allocation supported by the material furnished, but sustained the revenue-based allocation of KMP costs. It also rejected the assessee’s contention that corresponding cost-plus revenue

7 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., should be recognised in the segmental computation when costs relating to the same personnel were allocated to distribution. Applying the revised segmental computation, the DRP restricted the adjustment to ₹5,93,01,029 and directed deletion of the balance of the original adjustment. The AO gave effect to the DRP’s directions in the final assessment order dated 30 January 2020 and made an addition of ₹5,93,01,029.

7.

For Assessment Year 2016–17, the subscription-fee payments to the AEs amounted to ₹69,95,30,249. The assessee’s transfer-pricing study reported a TNMM margin of 3.94%; a segmental statement subsequently furnished in the proceedings reflected a margin of 3.85%. The assessee selected comparable companies with margins ranging from 0.06% to 1.72%, with a median of 0.19%. In its segmental computation, the assessee identified 37 employees as engaged in distribution and attributed employee costs of ₹6,68,41,223 to that segment. It allocated total KMP costs of ₹9,43,96,217 between distribution and support services by reference to employee costs, and included ₹8,42,28,193 of corresponding cost-plus-10% revenue in the segmental computation. The TPO accepted the employee costs supported by the employee records but did not accept the allocation of KMP costs. Treating those costs as common expenditure, he allocated ₹4,88,19,141 to distribution by applying the revenue ratio

8 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., and excluded the ₹8,42,28,193 of corresponding support- services revenue from the distribution-segment computation. The TPO thereby reduced the segmental margin to –11.97% and proposed an adjustment of ₹9,22,52,862. A draft assessment order was issued on 5 December 2019 and the assessee filed objections before the DRP on 2 January 2020. An assessment order was nevertheless issued on 28 February 2020 while those objections were pending, followed by an order under Section 154 dated 16 March 2020. The DRP issued its directions on 29 October 2020 and the AO passed a further final assessment order on 30 June 2021, making the adjustment of ₹9,22,52,862. The assessee’s grounds also challenge the procedure adopted under Section 144C and raise a limitation objection under Section 153.

8.

Ld. Senior Counsel Shri Percy Pardiwala on behalf of the assessee submitted that the primary issue in these appeals concerns the authority to invoke the transfer-pricing provisions for the subscription-fee transactions after clause (i) of Section 92BA of the Act had been omitted with effect from 1 April 2017. He emphasised that the relevant dates were not in dispute: the reference under Section 92CA(1) was made on 20 December 2017 for Assessment Year 2015–16 and on 29 November 2018 for Assessment Year 2016–17. Thus, when the AO initiated the transfer-pricing proceedings, clause (i), which had brought specified payments to persons referred to

9 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., in Section 40A(2)(b) within the definition of a specified domestic transaction, had already been omitted. Ld. Senior Counsel submitted that Section 92CA(1) authorises a reference only in respect of an international transaction or a specified domestic transaction; consequently, the statutory character of the transaction as an SDT was a condition precedent to the exercise of the TPO’s jurisdiction. The fact that the payments had been made in earlier previous years, or had been reported in Form 3CEB as SDTs when the returns were filed, could not, according to him, by itself confer jurisdiction to make a fresh reference after the statutory provision under which the transactions were treated as SDTs had been omitted.

9.

Ld. Senior Counsel further submitted that the CASS selection reason “Large specified domestic transaction(s)”— could not independently confer jurisdiction on the TPO. It merely recorded the basis on which the case was selected for scrutiny; the reference still had to satisfy the statutory requirements of Section 92CA(1). He pointed out that there had been no reference to the TPO, determination of arm’s- length price, or transfer-pricing adjustment in either year before 1 April 2017. The references and the proceedings that produced the impugned adjustments were initiated only after that date. In support, he strongly relied on the judgment of the Hon’ble Karnataka High Court in PCIT v. Texport

10 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., Overseas (P.) Ltd. (2020) 114 taxmann.com 568 (Karnataka), and submitted that the High Court had sustained the conclusion that the transfer-pricing action founded on clause (i) could not be maintained after its omission. He also relied on the Delhi Bench decision in Yorkn Tech Pvt. Ltd. v. DCIT, ITA No. 635/Del/2021, dated 18 August 2021; and the Mumbai Bench decision in Infrastructure Leasing and Financial Services Ltd. v. ACIT, ITA No. 1554/Mum/2021, dated 31 January 2024, submitting that those decisions applied the same principle to post-omission references concerning earlier assessment years. On that basis, Ld. Senior Counsel urged that the adjustments be deleted on the jurisdictional ground and that it would be unnecessary to adjudicate the competing segmental computations or the arm’s-length price of the transactions.

9.1 The assessee’s appeal grounds and supporting written material also challenge the adjustments on their merits. It has been contended that the actual costs of employees directly engaged in distribution should be recognised in that segment; that common KMP costs should be allocated by reference to the employee-cost ratio, or on a consistently applied and supportable basis; and that the TPO could not allocate employee and KMP costs to distribution while excluding the corresponding cost-plus-10% revenue recovered from the same AEs for the services of those employees. For

11 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., Assessment Year 2015–16, the assessee relies on the employee-wise details and actual costs furnished for the 28 distribution employees and disputes the continued revenue- based allocation of the KMP costs. For Assessment Year 2016–17, it relies on its segmental working for 37 distribution employees, its allocation of KMP costs by employee-cost ratio and its inclusion of the related support-services revenue. The assessee also relies on an alternative CUP analysis, including the earlier arrangement with MSM Discovery, and disputes the scope and computation of the adjustments, including the contention that any adjustment should be confined to the relevant AE transaction. Its grounds further raise issues under Section 40A(2)(b), and, for Assessment Year 2016–17, the procedure under Section 144C and limitation under Section 153. These matters are recorded as grounds and contentions appearing in the appeal record and written material; they are not attributed to Ld. Senior Counsel’s oral submissions except to the extent he addressed them at the hearing.

10.

Ld. Departmental Representative opposed the jurisdictional ground and supported the orders of the AO, TPO and DRP. She submitted that clause (i) of Section 92BA was omitted with effect from 1 April 2017, corresponding to Assessment Year 2017–18, and that the amendment should therefore govern that assessment year onwards. In her

12 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., submission, the transactions in the present appeals pertained to earlier assessment years, when payments of the kind made by the assessee to persons covered by Section 40A(2)(b) fell within the definition of specified domestic transactions. The subsequent date on which the AO made the references, she argued, did not alter the character of those transactions for the relevant assessment years or, by itself, invalidate the examination of their arm’s-length price. She accordingly urged that the omission should not be applied so as to defeat the transfer-pricing proceedings for Assessment Years 2015– 16 and 2016–17.

10.1 On the alternative merits, Ld. Departmental Representative supported the TPO’s view that the segmental costs had not initially been substantiated with sufficient employee-wise evidence and that revenue was a reasonable basis for allocating costs which related to both segments. She submitted that the DRP had considered the additional employee material, accepted the actual costs supported for the 28 distribution employees in Assessment Year 2015–16, and restricted the adjustment from ₹26,55,06,880 to ₹5,93,01,029. The remaining KMP expenditure, she contended, was common in nature and was reasonably apportioned by reference to segmental revenue. She supported the same approach for Assessment Year 2016–17 and opposed the contention that the support-services revenue

13 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., should be correspondingly transferred to the distribution segment. The Ld. Departmental Representative therefore submitted that, if the jurisdictional challenge were rejected, the adjustments sustained by the DRP should be upheld.

11.

We have heard both parties, considered the relevant facts and material on record qua the issues raised before us and examined the findings recorded in the orders of the authorities below. The principal question which arises for our consideration is, whether the references made by the AO under Section 92CA(1), after the omission of clause (i) of Section 92BA with effect from 1 April 2017, could furnish a valid foundation for the impugned transfer-pricing adjustments. The transactions pertain to Assessment Years 2015–16 and 2016–17, whereas the references were made on 20 December 2017 and 29 November 2018, respectively. The Revenue emphasises the assessment years to which the transactions belong; the assessee emphasises the dates on which the special transfer-pricing machinery was first invoked. These competing submissions require us to examine the effect of the omission in the light of the applicable statutory savings and the judicial decisions interpreting them. The issue cannot be looked by treating every omission as obliterating all consequences of the former law or by assuming that the identification of an earlier assessment year

14 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., necessarily preserves every subsequent exercise of power under the omitted provision.

12.

The relevant statutory provisions must first be considered together. Section 92(2A), introduced by the Finance Act, 2012, required an allowance for expenditure or interest, allocation of cost or expense, or income in relation to a specified domestic transaction to be computed having regard to the arm’s-length price. Section 92BA defined the transactions falling within that expression. Clause (i), before its omission, included expenditure in respect of which payment had been made or was to be made to a person referred to in Section 40A(2)(b), subject to the aggregate monetary threshold prescribed in Section 92BA. Section 92CA(1) authorised the AO, with the prescribed previous approval, to refer the computation of the arm’s-length price of an international transaction or specified domestic transaction to the TPO. The Finance Act, 2017 omitted clause (i) with effect from 1 April 2017, while the other specified categories continued in Section 92BA. The present adjustments were founded on the subscription-fee payments being transactions within the omitted clause; the Revenue has not sought to bring them within any remaining category of Section 92BA. The distinction between the former statutory obligation to compute income at arm’s length and the authority to initiate

15 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., a reference after omission is therefore material. Both aspects must be examined rather than treating the date of the reference as an answer divorced from the statutory scheme.

13.

Hon’ble Supreme Court in Kolhapur Canesugar Works Ltd. v. Union of India, (2000) 2 SCC 536, the Constitution Bench considered proceedings initiated under the former Rules 10 and 10A of the Central Excise Rules. Those rules had been omitted and the question was whether the pending proceedings could nevertheless continue. The Court emphasised the statutory distinction between a Central Act or Regulation and a subordinate rule and held that Section 6 of the General Clauses Act did not apply to the omitted rules in the circumstances before it. Paragraph 37 of the judgement explains the common-law consequence of repeal or deletion, but expressly recognises that Section 6 or a special statutory saving may modify that consequence. The succeeding paragraphs examine the absence of an applicable saving in the replacement provisions and conclude that the proceedings under the omitted rules had lapsed. The judgment thus requires the adjudicating authority to examine the savings applicable to the enactment concerned. Its discussion cannot be detached from the subordinate-legislation context and converted into a universal proposition that omission of a provision in a Central Act necessarily excludes Section 6 or extinguishes every earlier liability.

16 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd.,

14.

The distinction assumes particular importance in Fibre Boards (P.) Ltd. v. CIT, (2015) 10 SCC 333, which concerned the omission of Section 280ZA and its replacement by the exemption scheme in Section 54G. The assessee had shifted an industrial undertaking from Thane and claimed exemption under Section 54G; the issue included whether the earlier notification declaring Thane an urban area continued to operate. The Court examined the legislative scheme and held that Section 24 of the General Clauses Act continued the notification for the purposes of the re-enacted provision. More significantly for the present issue, paragraphs 27–32 of the judgement examine the relationship between omission and repeal. Paragraph 27 explains that, once Section 6 was found inapplicable to subordinate rules in Rayala Corporation, the further observation that omission was outside repeal was unnecessary to that decision. Paragraphs 28–29 refer to Section 6A and paragraphs 30–32 explain that repeal may be express or implied and need not employ a particular legislative formula. An express omission may therefore constitute repeal for Sections 6 and 24. The two statutory consequences must nevertheless be distinguished. Section 24 concerns continuity of instruments under repealed and re- enacted provisions; Section 6 preserves specified consequences of repeal unless a different intention appears. Absence of re-enactment may exclude the particular operation

17 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., of Section 24, but does not, for that reason alone, exclude Section 6. It would consequently be inaccurate to read Fibre Boards as holding that, whenever a provision is omitted without a replacement or express saving clause, all earlier obligations and proceedings necessarily disappear. The judgment establishes the applicability of the statutory savings framework; the nature of the right, obligation, liability or proceeding claimed to be saved must then be examined under that framework.

15.

The Supreme Court reaffirmed and explained that position in Shree Bhagwati Steel Rolling Mills v. CCE, (2016) 3 SCC 643. The Hon’ble Court referred to the definition of “enactment” in Section 3(19) of the General Clauses Act and explain that Section 6 extends to deletion of a provision within an Act. Paragraphs 17–24 of the judgement uphold the reasoning in Fibre Boards and reject the proposed distinction between omission and repeal. Paragraph 24 specifically addresses the consequences of excluding omissions from Section 6, including the loss of protection for previous operation and proceedings concerning accrued rights and liabilities. Paragraph 34 also rejects the proposition that proceedings could not be initiated merely because the rules had subsequently been omitted. The Court separately considered the validity of the interest and penalty provisions and invalidated them on other grounds. The rejection of the

18 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., omission argument must therefore be distinguished from the ultimate relief granted on the validity of those provisions. For present purposes, the decision confirms that omission does not, by its terminology alone, extinguish earlier liabilities or prohibit every subsequently instituted proceeding.

16.

Ergo, to summarise the sequitur of the principles emerging from the aforesaid decisions require that the effect of an omission has to be considered with reference to the nature of the enactment omitted and the savings applicable to it. In Kolhapur Canesugar Works Ltd. v. Union of India (Supra), the Supreme Court was concerned with the omission of provisions in the Central Excise Rules. It held that Section 6 of the General Clauses Act, 1897 did not apply to those Rules, since they were subordinate legislation and not a Central Act or Regulation within the meaning of that section. The Court’s observation that an omitted provision is ordinarily obliterated from the statute book cannot, therefore, be detached from that setting or read as laying down that Section 6 is inapplicable whenever Parliament omits a provision of an Act. Indeed, the Court recognised that the consequences of omission for past matters depend upon the savings available under Section 6 or under a special enactment. The position concerning an omitted provision of a Central Act was clarified in Fibre Boards (P.) Ltd. v. CIT (Supra). The Supreme Court held that an omission made by

19 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., an amending Act may amount to a repeal for purposes of Sections 6 and 24 of the General Clauses Act; it also explained that Section 6A recognises that an amendment may be made by express omission. Section 6 accordingly preserves, unless a different legislative intention appears, the previous operation of the enactment and rights, obligations and liabilities acquired, accrued or incurred under it, together with proceedings or remedies in respect of them. In this regard, Section 6(e) expressly contemplates that a proceeding or remedy in respect of a saved right, obligation or liability may be instituted, continued or enforced after repeal. Section 24, which was relevant to the continuation of the notification under the re-enacted provision in Fibre Boards, has a distinct operation and should not be conflated with the savings under Section 6. The subsequent decision in Shree Bhagwati Steel Rolling Mills v. CCE (Supra) reaffirmed that deletion of a provision of an Act falls within the statutory concept of repeal and rejected the proposition that omission, merely by its form, erases liabilities arising during the period when the provision operated. At the same time, these authorities do not mean that every power associated with an omitted provision remains available indefinitely. The Court must identify the particular right, obligation, liability, proceeding or remedy said to have been preserved and determine whether it falls within Section 6 and whether a different legislative intention appears. It follows that the omission does not warrant

20 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., treating the provision as though it had never existed for all purposes; nor does the mere fact that the relevant assessment year relates to a period before omission, by itself, establish that every later action under the former regime is saved. The effect of the omission on the references in the present appeals must therefore be determined by applying this statutory framework to the provisions governing specified domestic transactions and the circumstances in which the references were made.

16.1. In the present case, the provision omitting clause (i) of Section 92BA does not contain an express saving clause specifically preserving proceedings founded upon that clause. This absence must, however, be considered together with Section 6 of the General Clauses Act, which may preserve the previous operation of an omitted enactment, obligations or liabilities incurred thereunder and proceedings or remedies in respect thereof, unless a different legislative intention appears. The absence of a specific saving provision is, therefore, not by itself determinative. What requires examination is whether the references initiated after omission, in respect of transactions falling solely within the erstwhile clause (i), are proceedings concerning an obligation or liability preserved by Section 6. It is in this statutory setting that the decisions concerning omission of Section 92BA(i) must be considered.

21 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd.,

17.

That specific amendment came for consideration before the Hon’ble Karnataka High Court in PCIT v. Texport Overseas (P.) Ltd., (2020) 114 taxmann.com 568 (Karnataka). The Revenue contended that the omission operated prospectively and could not invalidate transfer-pricing proceedings for earlier assessment years. The High Court Tribunal’s rejected that challenge and sustained the conclusion that the TPO and DRP action founded on the omitted clause could not be maintained. It relied upon Kolhapur Canesugar in addressing the effect of omission and the applicable savings. The decision directly concerns Section 92BA(i), although it does not contain the detailed reconciliation of the later omission jurisprudence which appears in the decision of Tribunal in the case of Yorkn Tech, (Supra) discussed below. Being a judgment of a non- jurisdictional High Court, it has persuasive rather than territorial binding force before us. Nevertheless, it cannot be disregarded merely on that account: it is a High Court decision construing the very amendment in issue and its conclusion forms an important part of the authorities which the Tribunal has subsequently considered.

18.

In Yorkn Tech Pvt. Ltd. v. DCIT, ITA No. 635/Del/2021, dated 18 August 2021, the Delhi Bench considered the effect of omission of Section 92BA(i) in circumstances materially

22 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., comparable to those obtaining in the present appeals. There also, the transaction pertained to Assessment Year 2016–17, whereas the reference to the TPO was made on 29 November 2018, after the omission of the clause with effect from 1 April 2017. The Tribunal examined the statutory amendment with reference to Sections 6 and 6A of the General Clauses Act, 1897, and considered the decisions of the Hon’ble Supreme Court in Kolhapur Canesugar Works Ltd. v. Union of India, Fibre Boards (P.) Ltd. v. CIT and Shree Bhagwati Steel Rolling Mills v. CCE, together with the decision of the Hon’ble Karnataka High Court in PCIT v. Texport Overseas (P.) Ltd. Upon such consideration, the Tribunal held that no transfer pricing adjustment could be made in respect of a domestic transaction referred by the AO after omission of Section 92BA(i), notwithstanding that the transaction related to Assessment Year 2016–17. The same view was subsequently followed by the Mumbai Bench in Infrastructure Leasing and Financial Services Ltd. v. ACIT, ITA No. 1554/Mum/2021, dated 31 January 2024. These decisions, therefore, address the precise circumstance relevant here, namely, initiation of a reference under Section 92CA after the omission of the clause which brought the transaction within the specified domestic transaction regime. The similarity is material because, in the present appeals also, the references were first made on 20 December 2017 and 29 November 2018, respectively, and the disputed transactions were brought within that regime solely

23 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., by reference to the erstwhile clause (i) of Section 92BA. We accordingly find the conclusion reached in Yorkn Tech Pvt. Ltd., and followed in Infrastructure Leasing and Financial Services Ltd., directly applicable to the issue before us. Read with the decision of the Hon’ble Karnataka High Court in Texport Overseas (P.) Ltd., (Supra) these coordinate Bench assessee’s decisions support the contention that the impugned adjustments cannot be sustained on the strength of references initiated after omission of Section 92BA(i).

19.

We have also considered the decision of the Delhi Bench in Dixon Technologies (India) Ltd. v. Addl. CIT, ITA No. 6528/Del/2017, dated 2 September 2026. There, the TPO had passed his order on 10 October 2016, before the omission of Section 92BA(i) became effective, although the DRP directions and final assessment followed thereafter. The Tribunal rejected the assessee’s contention that the omission invalidated the adjustment for an earlier assessment year, principally on the ground that the amendment applied from Assessment Year 2017–18. It considered Kolhapur Canesugar Works Ltd. and Texport Overseas (P.) Ltd., together with authorities on statutory interpretation, but did not separately examine Fibre Boards (P.) Ltd., Shree Bhagwati Steel Rolling Mills, or Yorkn Tech Pvt. Ltd. This limitation does not, by itself, warrant treating the decision as per incuriam or its

24 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., conclusion as contrary to the Supreme Court authorities. A material distinction is that the transfer pricing proceedings in Dixon Technologies had culminated in a TPO order before omission, whereas, in the present appeals, the references themselves were first initiated thereafter. The distinction must nevertheless be examined within the statutory framework discussed above: Section 6 of the General Clauses Act preserves the previous operation of an enactment and obligations or liabilities incurred under it, unless a different legislative intention appears; it also permits subsequent institution of proceedings in respect of matters so preserved. Consequently, neither the prospective commencement of the amendment nor the date of initiation of a proceeding, considered in isolation, furnishes a complete answer to the effect of omission. The question requiring consideration here is whether references first initiated after omission of Section 92BA(i), in respect of transactions falling solely within that clause, can sustain the impugned adjustments. Yorkn Tech Pvt. Ltd. directly considered that circumstance for Assessment Year 2016–17, and its conclusion was subsequently followed by the Mumbai Bench in Infrastructure Leasing and Financial Services Ltd. We accordingly distinguish Dixon Technologies having regard to its pre- omission TPO determination and follow the coordinate Bench decisions which directly address the chronology arising before us. This conclusion is confined to the validity of the post-

25 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., omission references in these appeals and does not involve a finding that omission of Section 92BA(i) extinguished every obligation, liability or proceeding arising during the period when that clause operated.

20.

In reaching our conclusion, we have borne in mind the Revenue’s submission that Section 92(2A), read with the former Section 92BA(i), imposed an arm’s-length computation requirement for the relevant assessment years. That submission cannot be answered merely by observing that no additional tax had been quantified before 1 April 2017. Nor can Section 6(e), which permits institution of proceedings in respect of saved obligations or liabilities, be read as protecting only proceedings already pending. At the same time, the question whether the particular statutory amendment preserved authority to initiate a fresh reference under the omitted SDT category has been considered in the decisions discussed above. Yorkn Tech expressly dealt with an earlier- year transaction and a reference made after omission, and Infrastructure Leasing and Financial Services adopted that treatment. No material factual distinction has been shown between that situation and the present references. We consider it appropriate to follow those directly applicable decisions, read with Texport Overseas, rather than formulate a wider proposition concerning the accrual of tax liabilities which is unnecessary to decide these appeals. Our finding is

26 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., thus confined to the sustainability of these fresh post- omission references under Section 92BA(i). It neither declares all earlier statutory obligations extinguished nor reopens completed determinations under the former provision.

21.

For Assessment Year 2015–16, the AO’s reference dated 20 December 2017, and for Assessment Year 2016–17, the reference dated 29 November 2018, were made after the omission. The subscription-fee payments were brought within the SDT regime through clause (i), and no independent basis under another surviving clause of Section 92BA has been advanced. Applying the decisions discussed above, we hold that these references cannot sustain the resulting transfer- pricing adjustments. In relation to Assessment Year 2015–16, we have also considered the judgment of the Hon’ble Bombay High Court in the assessee’s own case, Times Global Broadcasting Company Ltd. v. Union of India, Writ Petition No. 3386 of 2018, dated 15 March 2019. The Court quashed the demerger-related adjustment and declined writ examination of the subscription-fee computation, leaving the assessee to the statutory remedies. Its discussion did not decide the present omission ground on its merits. It would therefore be inaccurate to describe that judgment as affirming the subscription-fee ALP computation on merits. The present adjudication is in the statutory appeal against the final

27 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., assessments. The adjustments of ₹5,93,01,029 for Assessment Year 2015–16 and ₹9,22,52,862 for Assessment Year 2016–17 are accordingly directed to be deleted.

22.

The assessee has also advanced substantial arguments in its written submissions on the merits of the transfer pricing adjustments, although these aspects were not addressed in the oral submissions. Since we have deleted the impugned adjustments on the preliminary legal ground, the alternative grounds concerning determination of the arm’s length price do not require separate adjudication and are left open, without expressing any opinion on their merits. There being no independent determination under Section 40A(2)(a) in the impugned assessments, the adjustments cannot be sustained as disallowances under that provision. The separate grounds under Sections 144C and 153 are likewise left undecided, as deletion of the only disputed additions grants the assessee effective relief in these appeals.

23.

In the result, the jurisdictional grounds concerning the references made after omission of Section 92BA(i) are allowed. The AO is directed to delete the transfer-pricing adjustments of ₹5,93,01,029 for Assessment Year 2015– 16 and ₹9,22,52,862 for Assessment Year 2016–17. The alternative ALP grounds and the remaining procedural

28 ITA No.1507/Mum/2020 & 1487/Mum/2021 Times Global Broadcasting Co. Ltd., grounds are disposed of as academic for the reasons stated above. Both appeals are allowed in these terms.

Order pronounced on 19th October, 2026.

Sd/- Sd/- (G.M. DOSS) (AMIT SHUKLA) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai; Dated 19/10/2026 KARUNA, sr.ps

Copy of the Order forwarded to : 1. The Appellant 2. The Respondent. 3. CIT 4. DR, ITAT, Mumbai 5. Guard file. //True Copy//

BY ORDER, ABHINAV Digitally signed by ABHINAV ANANT ANANT GAVANDE Date: 2026.10.28 13:01:55 GAVANDE +05'30' (Asstt. Registrar) ITAT, Mumbai

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