Formula One World Championship Ltd vs Commissioer Of Income Tax, ...

The Supreme Court addressed the appeals concerning the tax implications of payments made under a Race Promotion Contract (RPC) between Formula One World Championship Limited (FOWC) and Jaypee Sports International Limited. The Court upheld the High Court's ruling that FOWC has a Permanent Establishment (PE) in India under Article 5 of the Double Taxation Avoidance Agreement (DTAA), thus making it liable for tax in India. The Court clarified that the payment made by Jaypee to FOWC does not constitute royalty under Article 13 of the DTAA, which has attained finality as the Revenue did not contest this finding.