Dharma Productions countered that licensing film rights falls under Heading 9973 (SAC 997332), which was subject to a lower rate of 12 percent GST prior to the amendment notification on October 1, 2021.
The bench rejected the revenue department’s position on digital delivery modes. It stressed that passive film content fails to meet the statutory definition of software under the Rate notification.
“There is no finding, much less a finding, as to how a cinematographic film, a passive audio visual work, incapable of execution, manipulation or inter-activity could ever satisfy the statutory definition ‘information technology software’,” the order.