Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (7) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (7) TMI 368 - AT - Income TaxRoyalty expenses - Allowable capital expenditure or revenue expenditure - 100% of Royalty paid should be considered as Revenue Expenses or 25% should be disallowed as done by AO - HELD THAT:- Admittedly, the CIT(A) has dismissed the appeal of the assessee in cryptic and summary manner without even reiterating the ground of appeal raised by the appellant before him. Grievance of the assessee has been pertaining to its claim of royalty as revenue expense but the Ld. CIT(A) has not even touched the word of royalty and thus, the issue of royalty claimed as a revenue expenditure, the peculiar fact of the instant case remain unaddressed by CIT(A). It is noted that the CIT(A) has merely stated in its judgment that hence, both the limbs of Malabar Industrial Co. [2000 (2) TMI 10 - SUPREME COURT] are satisfied. Hence, the AO is justified in making addition on the basis of judgment of Hon’ble Supreme Court in the case of Southern Switch Gear [1997 (12) TMI 105 - SC ORDER] CIT(A) is liable to pass a speaking order on merits by rebutting the contention raised by the appellant before him and distinguishing the citations relied upon in support thereof. In our view, such a cryptic and non-speaking order of the CIT(A) is against the principles of natural justice and bad in law. We consider it deem fit to restore back the matter to the file of the Ld. CIT(A) to adjudicate the appeal afresh on the issue of claim of royalty expense after considering the written submission and evidences filed on record and may be filed before him during the fresh proceedings after granting sufficient opportunity of being heard to the assessee
|