PRINCIPAL COMMISSIONER OF INCOME TAX - 4, DELHI vs. M/S LEX SPORTEL VISION PVT. LTD.

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ITA/821/2026HC DelhiDLHC01049658202613 October 2026Author: HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD,HON'BLE MS. JUSTICE RENU BHATNAGAR5 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal, finding no substance or merit in it. The Court relied on its previous judgment in ITA 334/2026, which in turn was guided by the decision in ITA 4/2026 (The Commissioner of Income Tax - International Taxation -3 v. Sri Lanka Cricket). In that precedent, the Court held that 'live feed' does not attract royalty. The reasoning was that royalty presupposes enduring benefits, and if the license is confined to a live telecast of an event within a specific period and not for subsequent matches or future use, the payment cannot be considered royalty. The Court noted that the Special Leave Petition (SLP) filed by the department in an identical question had been withdrawn. The Court found that the rights granted to the respondent did not exceed the 'live feed' and did not involve the right to record, preserve, or re-telecast for enduring benefit. Therefore, the payments made were not royalty. The questions raised in the present appeal were answered against the revenue.

What were the facts?

The appellant, Principal Commissioner of Income Tax - 4, Delhi, filed an appeal before the Delhi High Court challenging an order dated 27.04.2026 passed by the Income Tax Appellate Tribunal (ITAT) in ITA No. 7775/DEL/2025. The appeal was filed with a delay of 21 days, for which condonation was sought and granted. The present appeal concerns the same assessee, M/s Lex Sportel Vision Pvt. Ltd., as a previous case, ITA 334/2026, which dealt with a different issue but raised similar questions of law regarding the taxability of foreign remittances as royalty under Section 9(1)(vi) of the Income Tax Act, 1961. The High Court had previously considered these questions in ITA 334/2026.

What were the issues?

1. Whether, in the facts and circumstances of the case and in law, the ITAT erred in treating foreign remittance not chargeable to tax as royalty under Section 9(1)(vi) of the Income Tax Act, 1961? (Mixed law and fact) 2. Whether, in the facts and circumstances of the case, and in law, the ITAT erred in holding that the payments in dispute are not made for use of any process as defined under Section 9(1)(vi) of the Act and cannot be charged to tax as 'royalty' in the hands of the overseas rights holder? (Mixed law and fact) Assessee's Contentions: The judgment does not record specific contentions made by the assessee in this appeal. However, the context suggests the assessee likely supported the ITAT's decision. The previous judgment in ITA 334/2026, which is relied upon, indicates that the assessee's position was that 'live feed' does not attract royalty and that payments for exhibition rights confined to live telecast do not constitute royalty as they do not involve enduring benefits. Revenue's Contentions: The revenue, as the appellant, argued that the ITAT erred in its findings concerning the taxability of foreign remittances as royalty. They proposed questions of law challenging the ITAT's decision to treat foreign remittances not chargeable to tax as royalty and its holding that payments were not for the use of any process as defined under Section 9(1)(vi), thus not chargeable as royalty. In ITA 334/2026, the revenue also questioned whether payments for 'live rights' were not made for a bouquet of rights.

Which sections of the Income-tax Act were involved?

Section 9(1)(vi),Section 260A

AI-generated summary — verify with the full judgment below

Cause title — parties, addresses and appearances
$~146 * IN THE HIGH COURT OF DELHI AT NEW DELHI # CNR No. DLHC010496582026 + ITA 821/2026 PRINCIPAL COMMISSIONER OF INCOME TAX - 4, DELHI .....Appellant Through: Counsel (Appearance not given). versus M/S LEX SPORTEL VISION PVT. LTD. .....Respondent Through: Mr. Sachit Jolly, Sr. Adv. Mr. Karanjot Singh Khurana, Ms. Sherry Goyal, Ms. Viyushti Rawat and Mr. Avar Lamba, Advs. CORAM: HON'BLE MR. JUSTICE SUBRAMONIUM PRASAD HON'BLE MS. JUSTICE RENU BHATNAGAR

O R D E R %

13.10.

2026 CM APPL. 71588/2026

1.

The instant application has been filed by the appellant under Section 260A(2A) of the Income Tax Act, 1961 read with Section 5 of the Limitation Act, 1963 seeking condonation of delay of 21 days in filing the present Appeal.

2.

For the reasons stated in the application, the delay is condoned. The application stands disposed of. ITA 821/2026

3.

The instant Appeal has been filed by the Appellant challenging This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

the Order of the Income Tax Appellant Tribunal (hereinafter ITAT) dated 27.04.2026 in ITA No. 7775/DEL/2025

4.

For a different issue, however, concerning the same assessee, the question that also arises in the present case was considered by this court in ITA334/2026 namely: (i) whether in the facts and circumstances of the case and in law, the ITAT has erred in treating foreign remittance not chargeable to tax as royalty under Section 9(l)(vi) of the Income Tax Act, 1961? (ii) Whether in the facts and circumstances of the case, and in law, the ITAT has erred in holding that the payments in dispute are not made for use of any process as defined under section 9(l)(vi) of the Act and can't be charged to tax as 'royalty' in the hands of the overseas rights holder?

5.

This Court in ITA 334/2026 titled ‘The Commissioner of Income Tax - International Taxation -2 Vs. Lex Sportel Vision Pvt.Ltd.’ has passed the following order: “

XXX

3.

The present appeal has been preferred under Section 260A of the Income Tax Act, 1961 by the appellant-Department challenging the order dated 26.12.2023 passed by the Income Tax Appellate Tribunal, Delhi Bench „D‟, New Delhi.

4.

The following questions of law have been proposed by the appellant: This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

1.

Whether in the facts and circumstances of the case and in law, the ITAT has erred in treating foreign remittance not chargeable to tax as royalty under section 9(l)(vi) of the Income Tax Act,1961?

2.

Whether in the facts and circumstances of the case, and in law, the ITAT has erred in treating the payment made for 'live rights to have not been made for a bouquet of rights?

3.

Whether in the facts and circumstances of the case, and in law, the ITAT has erred in holding that the payments in dispute are not made for use of any process as defined under section 9(l)(vi) of the Act and can't be charged to tax as 'royalty' in the hands of the overseas rights holder?

5.

On perusal of the questions, we are reminded of our judgment dated 15.01.2026 rendered in ITA 4/2026 titled The Commissioner of Income Tax - International Taxation -3 v. Sri Lanka Cricket reported in 2026 SCC OnLine Del 242, wherein this Court has held that „live feed‟ does not attract royalty. The operative part of the aforesaid judgment reads thus:

“4. We have perused the judgment This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

of CIT v. Fox Network Group Singapore Pte. Ltd. and also considered the fact that even the SLP involving identical question filed by the department had been withdrawn.

5.

That apart, Mr. Ruchir Bhatia, learned counsel for the appellant has not been able to point out any fact which shows that the rights of exhibition given by the respondent Sri Lanka Cricket exceeded beyond the „live feed‟.

6.

Since the right to show cricket matches was confined to live telecast and the payment made was only for the match(es) held in the series (within 12 months) and not subsequent matches, such amount paid to the respondent cannot be considered as a royalty. „Because, royalty presupposes enduring benefits‟. In case the licensee has a right to record or preserve the feed and he continues to derive benefit of that recording and has right to re-telecast or show those matches in future, beyond the period or event(s) other than such event, then only, the payment made to the licensee in appropriate case, can be treated as royalty. However, it is not the case in the present agreement or transaction, hence the amount in question cannot be considered as royalty.”

This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

6.

In light of the above judgment, we do not find any substance and merit in the present appeal, accordingly, it is hereby dismissed.”

6.

The questions raised in this appeal have been answered against the revenue.

7.

In view of the above, the Appeal stands disposed of. All the pending applications, if any, are also disposed of.

SUBRAMONIUM PRASAD, J

RENU BHATNAGAR, J OCTOBER 13, 2026/pd/kz

This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

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