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2012 (11) TMI 61 - AT - Income TaxRecurring royalty /fees - capital v/s revenue - Disallowance u/s 37(1) - CIT(A) allowed the claim - Held that:- The issue is covered in favour of the appellant by the orders of ITAT, Ahmedabad in appellant’s own case for A.Y. 2005-06 to 2007-08 relying on CIT V/s Ashoka Mills Ltd. [1995 (10) TMI 35 - GUJARAT HIGH COURT] wherein held that the payment of royalty was clearly under the agreement between the assessee and other partly, since not merely the ownership of a trade mark but even the right to use the said trade mark could be parted with for a consideration - the two companies in question were distinct entities dealing at arm's length and it certainly could not be urged that the payment was made for any consideration other than business & held in favour of the assessee that the payment of royalty in question was a revenue expenditure - appeal decided in favour of assessee.
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