Law:

Section:

Section 9 of the Income-tax Act, 1961 - Income - Deemed to accrue or arise in India - Petitioner was association of composers, authors and publishers of copyright musical works incorporated under English Companies Act in England - It received royalty in London from All India Radio for broadcasting western music in India - ITO as well as Addl. Commissioner held that such royalty was assessable as income in India - Whether, in instant case, emphasis was not to be on source upon which income-tax was to be assessed but it was necessary to see where income accrued and, therefore, income was taxable in India - Held, yes FACTS The petitioner was an English Company. It was an association of composers, authors and publishers of copyright musical works. The petitioner entered into an agreement with All India Radio for broadcasting western music in India for which All India Radio was to pay royalty to the petitioner in London. The ITO held that such royalty was assessable as income in India. On petitioner's application under section 264, the Addl. Commissioner upheld the order passed by the ITO. On reference: HELD Under section 5(2) it has been provided that the total income of any previous year of a person who is a non-resident includes all income from whatever source derived. Admittedly, the petitioner was a non-resident. Sections 5(1)(a)(b ) and (2)(b) provide for the scope of total income which may from whatever source be derived and which accrues or arises or is deemed to accrue or arise to him in India during such year. Under section 9(1) it has been provided that all incomes accruing or arising from any source or income in India shall be deemed to accrue or arise in India. Admittedly, in the instant case the source of income was broadcasting by the All India Radio of western music for which the petitioner had a right to receive royalty from the All India Radio in London. In the instant case, the emphasis was not to be on the source upon which income-tax was to be assessed but it was necessary to see where the income accrued and, therefore, the income was taxable under the Act. Note : The decision was in favour of revenue. CASES REFERRED TO Rhodesia Metals Ltd. v.…

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