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2023 (8) TMI 718 - ITAT, PUNENature of expenses - Capitalization of Engineering Research and Development cost incurred by the assessee during the year claimed as revenue expenditure - HELD THAT:- As manifest from the key points of the Agreement as culled out above that the assessee did not have any dominion and control over the intellectual property rights of the technology developed by Lear and Tachi-S, which was simply licensed to it on non-exclusive basis. Thus, the payment by the assessee did not result in acquiring and owning the Engineering and Development Technology so as to be characterized as an intangible asset capable of capitalization. Rather, it is a case of payment in the nature of royalty for the use of such Technology, being an item of revenue nature. As such, the view point of the authorities below in this regard does not merit our concurrence. We, therefore, overturn the impugned order on this score and direct to delete the disallowance made by the AO and affirmed in the first appeal.
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