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2015 (7) TMI 76 - AT - Income TaxDisallowance of trade mark fee - revenue v/s capital - CIT(A) allowed claim - Held that:- As relying on CIT vs. G4S Securities System (India) Pvt. Ltd. [2011 (7) TMI 65 - DELHI HIGH COURT] wherein exactly the similar to the issue involved in the present appeal to hold the ownership rights of the trade mark and knowhow throughout vested with G4F and on the expiration or termination of the agreement the assessee was to return all G4F knowhow obtained by it under the agreement. The payment of royalty was also to be on year to year basis on the net sales of the assessee and at no point of time the assessee was entitled to become the exclusive owner of the technical knowhow and the trade mark. Hence, the expenditure incurred by the assessee as royalty is revenue expenditure and is therefore, relatable under Section 37(1) of the Act. - Decided in favour of assessee. Proportionate rights to use the software - revenue v/s capital - Held that:- The treatment of a particular expense or, a provision in the books of accounts can never be conclusively determinative of the nature of the expense. An assessee cannot be denied a claim for deduction which is otherwise tenable in law on the ground that the assessee had treated it differently in its books. The observation of the Supreme court in the case of Kedar Nath Jute Manufacturing Co. Ltd. vs CIT (1971 (8) TMI 10 - SUPREME Court) puts this beyond doubt and hold whether the assessee is entitled to a particular deduction or not will depend on the provision of law relating thereto and not on the view which the assessee might take of his rights nor can the existence or absence of entries in the books of accounts be decisive or conclusive in the matter - Decided in favour of assessee. Addition u/s 14A - CIT(A)deleted the addition - Held that:- No expenditure in the form of interest on other expenditure for earning of exempt income was pointed out by A.O. It is an established law that for making disallowance u/s 14A finding of fact with respect to incurring of expenditure is a pre-requisite which has not been done in this case. We find that Ld. CIT(A)'s finding are exhaustive and detailed and we do not find any infirmity in the same.- Decided in favour of assessee. Repair and maintenance expenditure disallowed - CIT(A) allowed claim - Held that:- The assessee had filed necessary details regarding repair & maintenance and had submitted complete break-up of spare parts and labour charges. The non furnishing of information in 1-2 columns out of 26 columns cannot be aground for disallowance of the claim especially in view of the fact that such information was not statutory information. The items which required capitalization were already capitalized by assessee and, therefore, Ld. CIT(A) has rightly deleted the same and we do not find any infirmity in the order of Ld. CIT(A). - Decided in favour of assessee.
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