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2013 (5) TMI 192 - ITAT DELHIRoyalty Expenses – Accrual - matching principle - Only a part of the income was accounted for during the year on the ground that the fee in question relates to two Financial years. Similarly on matching principle, a part of the expense was accounted for proportionately during the year. The assessee paid royalty to its holding company M/s HITJEE @ 20% of the fee received. However as far as expenses on account of royalty is concerned, the entire amount was claimed during the current year itself without apportioning the same in two years. - according to the assessee the royalty @ 20% of the gross course fee received was paid to the licensor, as per the terms of the agreement and that as per the agreement, royalty becomes due as soon as a student is enrolled Held that - In our considered opinion, First Appellate Authority has rightly applied the ratio of this judgement of the Jurisdictional High Court in CIT vs. Citi Financial Consumer Finance Ltd. [2011 (3) TMI 622] to the facts of this case. The First Appellate Authority also noted that in the subsequent AY i.e. 2008-09, no disallowance has been made. Thus even on the ground of consistency, we agree with the Ld.CIT(A). Hence we uphold the order of the CIT(A) - Decided against the revenue.
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