CABLE OPERATORS LIABLE TO DEDUCT TDS

The Punjab and Haryana High Court has held that a Cable TV operator is liable to deduct tax from the payments made to licencor or distributor of TV Channels, for obtaining TV signals under section 194C of the IT Act. In the relevant case, the assessee, a cable TV network operator, had entered into
contract with licencor or distributor of TV channels for local cable distribution system. It paid airing charges to the licencor or distributor for broadcasting of programs without deducting tax. The assessing officer took the view that assessee was required to deduct tax at source (TDS) under section 194C of the I-T Act. The high court observed that the definition of ‘work’ includes broadcasting and telecasting under section 194C of the I-T Act. Further, it was clear from the agreement that the assessee obtained ‘broadcasting and telecasting’ rights of TV channels and thereafter it distributed
among st ultimate customer. Therefore, what assessee transacted for with the licencor and distributor certainly includes within its ambit broadcasting and telecasting facility. So, it was liable to deduct TDS on the payments.