HC : Holds PILCOM as agent of foreign Cricket Boards regarding 1996 World Cup receipts

Calcutta HC reverses ITAT order and rules in favour of Revenue for AY 1996-97, holds PILCOM as agent of Non-Resident Cricket Boards in relation to 1996 World Cup receipts; Pursuant to ICC choosing Pakistan, India and Sri Lanka to co-host the World Cup 1996, a joint management committee of these three countries (PILCOM)] was formed which paid guarantee money to cricket associations of various countries and other sums from bank account in London; While the AO had made an assessment of income u/s. 147 for all the cricket boards through PILCOM, ITAT had quashed the same and had held that PILCOM could not be held liable as agent u/s. 163 as the income had accrued in India and it could not be said to be deemed to have accrued in India; Referring to Sec. 5 (scope of total income), Sec. 9 (income deemed to accrue/ arise in India) and Sec. 163 (relating to non-resident agent), HC holds that ITAT completely misinterpreted the law, remarks that “It goes without saying that the representative assessee not only represents an income which has directly arisen or accrued in India but also that which has indirectly arisen or accrued in this country, through a business connection.”; Noting that the short title to Sec. 9 describes the income as deemed to accrue or arise in India, HC clarifies that “Use of this title does not absolve the representative assessee of the duty to account for any income which has directly or deemed to have arisen to the non-resident in this country.”  :HC