TDS on Satellite rights & Video rights of feature films

Hi Mr Damodhar,

I think your client would need to make TDS when it buys satellite rights from the film producers. Subsequently the Television companies when they make payment to your client for getting the right to broadcast those films/programmes would be required to make TDS too. In the first instance, I feel Section 194J is attracted, as what your client pays to the film producers seems to be Royalty. The meaning of royalty for the purposes of Section 194J is to be the one discussed in Explanation 2 to clause (vi) of sub-section (1) of Section 9:[Explanation 2.—For the purposes of this clause, "royalty" means consideration [….] for:(v) the transfer of all or any rights (including the granting of a licence) in respect of any copyright, literary, artistic or scientific work including films or video tapes for use in connection with television or tapes for use in connection with radio broadcasting, but not including consideration for the sale, distribution or exhibition of cinematographic films]So your client would need to make TDS u/s 194J @ 10 per cent (plus SC and EC) on the payments made towards purchase of satellite rights. As regards the TV companies. I think they'd be required to deduct tax at source too but not u/s 194J. Section 194C seems to be more appropriate in their case. What the TV companies pay to your client is on account of subscription for obtaining telecast signals; they don't it appears buy the satellite rights as such from your client. But I am not sure. Are the telecast rights sold to TV channels for their exclusive use? Do the particular TV networks that buy those rights monopolize them in the sense that no other TV channel can broadcast those programs? If the answer is yes, then I think TDS will be made u/s 194J as the payment is towards purchase of rights and not execution of a work as envisaged in point (b) of Explanation III to Section 194C.Thanks,CA Sanjeev Bedi--- In ICAI_CIRC_MEERUT_ CA@yahoogroups. com, "dmrasoc" wrote:>> > Dear all> > can you clarify me. one of our cilent is doing the business of buying > the satillite rights from the film producers and the same rights was > sold to the TV companies frequently. In this regard any TDS is to be > deducted by my client and the TV company respectly.> > > with regards > Damodhar