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2018 (6) TMI 1598 - AT - Income TaxAddition on account of expenditure incurred for acquiring an intangible asset in the form of technical know-how - AO treated the same as capital expenditure and the first appellate authority treated them as revenue expenditure - HELD THAT:- The assessee obtained a technical know-how in respect of manufacturing of paper maker felts and other industrial fabrics. According to the agreement entered into by the assessee the remuneration was paid for at the rate of 5% on the sale price of the product. CIT (A) has considered the various clauses of the agreement and held that the know-how was to remain the sole and exclusive property of the provider and the appellant company is required to fully exploit the same. The technical know-how was also in relation to the sales affected by the assessee company. It is also required to be noted that assessee is engaged in the same business for which technical know-how is by the assessee and it is not at its an altogether a new line of business which is developed. DR could not point out any infirmity in the order of the CIT (A). No reason to disturb the finding of the CIT (A) in allowing the claim of the assessee of technical know-how fees paid to its parent company as revenue in nature. - Decided against revenue.
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