PERFORMING RIGHT SOCIETY LTD. & ANR. vs COMMISSIONER OF INCOME-TAX & OTHERS

The Supreme Court held that under Section 5(2) of the Income Tax Act, 1961, income accrued or arose in India is taxable regardless of where the agreement was executed or where the income was received. The Court clarified that the source of income is not relevant if it accrues in India, thus affirming that the royalties received by the non-resident Society from the All India Radio were taxable in India. The judgment also distinguished previous cases regarding the application of income, emphasizing that the Society's distribution of royalties does not constitute a diversion of income.