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2012 (11) TMI 384 - AT - Income TaxApplicability of Section 263 – condition – payment of royalty – capital or revenue – Held that:- If royalty has been paid on turnover basis, the same will be treated as revenue expenditure - royalty in the present case is based on turnover - Tribunal has clearly given the direction that if royalty has been paid on turnover basis, the same will be treated as revenue expenditure. Since the fact that royalty is paid on turnover basis is not disputed by the Assessing Officer in the order dated 30th December, 2009, issue is covered in favour of the assessee - payment of royalty by the assessee has to be considered in field of revenue - CIT has wrongly exercised his power u/s 263 and his order is liable to be quashed and is accordingly quashed – in favor of assessee
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