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2013 (10) TMI 744 - AT - Income TaxPurchase of Audio rights, a revenue expenditure of an expenditure of capital nature – Held that:- Reliance has been placed upon the judgment in the case of Super Cassettes Industries P. Ltd. v. CIT[1992 (3) TMI 123 - ITAT DELHI-A], wherein it has been held that royalty paid for obtaining rights of reproduction of audio sound and music from master plate was allowable as revenue expenditure - The concern purchased master plate by way of assignment of copyrights which contain original sound-track and songs, reproduced the same into blank cassettes with the help thereof and sold the same in market. The concern here had paid the consideration money partly in shape of a fixed sum initially and partly by way of percentage of sale value of the recorded cassettes - The plate cannot be termed as of capital nature. The initial lump sum payment and subsequent reimbursement in the form of royalty on sales will not change the character of its expenditure being revenue in nature - Respectfully following the ratio laid down by this Tribunal in the abovecited case, expenditure in purchase of Audio rights are revenue in nature – Decided against the Revenue.
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