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2017 (9) TMI 486 - HC - Income TaxPayment for technical knowhow - nature of expenditure - revenue expenditure under Section 37(1) or capital expenditure under Section 35AB - Held that:- The acquisition of technical knowhow is by way of license for manufacture of the raw material required for the parent business of steel production. The raw material produced is required to be used for the finished product of which the main business of manufacture of steel is undertaken by the respondent. In our view, this aspect has been dealt with by the Division Bench of the Gujarat High Court in the decision in case of Commissioner of Income Tax vrs. Suhrid Giegy Ltd., reported in (1995 (12) TMI 25 - GUJARAT High Court) It is apparent that all factors taken into consideration clearly indicate that it is a revenue expenditure and we do not find any error is committed by the Tribunal in holding that it is covered by Section 37(1) of the Income Tax Act. The substantial questions of law are answered accordingly. The appeals are, therefore, dismissed.
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