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IT Department to Contest Exemption of Capital Gains Tax in Zee-Sony Deal Ruling

14 Jun 2023 , 11:42 AM

Zee Entertainment’s subsidiary, Taj TV, based in Mauritius, sold Ten Sports to Sony as part of a business purchase agreement signed in 2016. The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) determined that the sale of the sports channel is not taxable in India.

The income tax department intends to approach the Bombay High Court to contest a ruling that grants an exemption from capital gains tax on the sale of Ten Sports to SonyPictures Network. The sale transaction, valued at approximately Rs 1,800 crore, took place seven years ago, according to a news report.

Taj TV, being a Mauritian entity, has no permanent establishment in India, allowing it to benefit from the Double Taxation Avoidance Agreement. The ITAT ruling states that gains from property alienation are taxable only in the country of residence of the entity making the sale, which in this case is Mauritius. As a result, the ITAT concluded that gains amounting to approximately Rs 1,798 crore from property sales are not subject to tax in India.

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Related Tags

  • business
  • income tax department
  • news
  • Sony
  • ten sports
  • tv
  • TV News
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