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2018 (12) TMI 1399 - HC - Income TaxNature of expenditure - technical knowhow expenditure - revenue or capital expenditure - only objection of the Assessing Officer was that by virtue of the amendment in Section 32, this position would no longer be valid - Held that:- AO did not seriously dispute that the expenditure was in the nature of revenue expenditure. We notice that by virtue of such amendment in subsection (1) of Section 32 sub clause (ii) of subsection (1) of Section 32 merely grants depreciation on the listed intangible assets, in absence of which, the assessee would not be entitled to such depreciation. This provision however, cannot be pressed in service to examine whether certain expenditure for acquisition of know-how or similar intangible asset is revenue or capital expenditure. It would depend on the nature of expenditure. If it is a capital expenditure, it will be eligible for depreciation in terms of Section 32(1) of the Act. If it is revenue expenditure and expended wholly or exclusively for the purpose of the business, in any case, the assessee would be entitled to deduction thereof. Income accrued in India - attempt to tax the income in the hands of the assessee in relation to the assessee's units situated at USA and UK - Held that:- Nothing is available on record to indicate any challenge by the Revenue to the order of the Tribunal for Assessment Years 199697 and 1997-98 before any higher forum. It therefore follows that the orders of the Tribunal on the above issue for the Assessment Years 1996-97 and 1997-98, have been accepted by the Revenue. Therefore, the Revenue can have no grievance with the impugned order of the Tribunal as it merely follows its earlier orders which have been accepted. Further, no distinguishing features in the present Assessment Year from that existing in the Assessment Years 1996-97 and 1997-98 have been brought to our notice which would justify our taking a different view on this issue for the subject Assessment Year.
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