9911796707
Advanced Search 
TMI Blog2019 (4) TMI 1224X X X X Extracts X X X X X X X X Extracts X X X X ..... 1)(c) of the Act. Learned A.R. in this respect filed a chart showing the issue-wise decision of Hon'ble Tribunal in respect of all four years. Learned A.R. submitted the issue No. 2,3, 4 & 6 have been allowed by the Tribunal in favour of the assessee whereas the issue No. 1 & 5 have been set aside to the Assessing Officer for reexamination. It was submitted that in both scenario the penalty sustained by Learned CIT(A) needs to be deleted as the quantum itself has been decided either in favour of the assessee or has been set aside to the Assessing Officer. 3. Learned D.R. though supported the orders of the authorities below but was unable to controvert the arguments of Learned A.R. 4. We have heard the rival parties and have gone throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th disallowance out of Technology Enhancement Fee, Agronomy Management Fee and Production Facility Management Fee and has raised the issue in grounds 3,4,5 and 6. The Ld. AR has drawn our attention to the Licence Fee Agreement as well as the Service Agreement and has emphasised that the amounts paid had been paid under the terms of the two agreements. It is the contention of the Ld. AR that although the licence fee paid by the assessee has been accepted by the department in earlier years, the other fees were not allowed on the ground that the benefit was of enduring nature and could not be said to have accrued only in one year. It is the contention of the Ld. AR that the impugned fees have been paid for the purpose of providing and sharing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Apex Court in the case of Madras Industrial Corporation Ltd. vs. CIT (supra) while holding that since the benefit was accruing to the assessee over a number of years, the same could not be allowed as a deduction in one year. However, it is seen that the judgment of the Hon'ble Apex Court in the case of Madras Industrial Corporation Ltd. vs. C.I.T. (supra) was rendered in the context of allowability of discount on debentures and, admittedly in this case, the liability was to accrue from year to year for a period of 12 years. It is in this context that the Hon'ble Apex Court held that since the payment was to secure a benefit over a number of years and there was a continuing benefit to the business of the assessee company for a number of ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dentical ground nos. 5, 6, 7, and 8 in assessment year 05, ground nos. 4, 5, 6, 7 in assessment year 2005-06 and ground nos. 3, 4, 5, and 6 in assessment year 2006-07 stand allowed." 6. The issue of loose tools mentioned in Sl.No. 5 is involved only in three years and the matter has been set aside to the Assessing Officer by Hon'ble Tribunal. The relevant findings of Hon'ble Tribunal, as contained in para 11.1, are reproduced below: "Ground no. 7 in assessment year 2003-04 challenges the action of the Assessing Officer in holding the expenditure with respect to loose tools as being capital in nature and allowing depreciation @25% thereon. A perusal of the assessment order shows that the Assessing Officer has simply mentioned that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 in assessment year 2005-06 stand allowed for statistical purposes." 7. The issue listed at Sl.No. 6 on upfront fee is also involved in one year i.e. assessment year 2004-05 which has been decided by Hon'ble Tribunal in favour of the assessee. The relevant findings of Hon'ble Tribunal, as contained in para 11.2.1, are reproduced below: "11.2.1Accordingly, respectfully following the judgment of the Hon'ble Apex Court as aforementioned, we are of the considered views that the entire upfront fee was allowable as a deduction in assessment year 2004-05 itself and accordingly, we set aside the order of the Ld. Commissioner of Income Tax (A) on the issue and direct the Assessing Officer to allow the entire amount in the year under con ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
