TMI Blog1993 (1) TMI 42X X X X Extracts X X X X X X X X Extracts X X X X ..... stions are: For the assessment years 1970-71, 1971-72 and 1973-74 : " 1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the payment by way of technical fees to Messrs. Westing House Brake and Signal Co. Ltd. in the respective previous years relevant to the assessment years 1970-71, 1971-72 and 1973-74 was a permissible deduction ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that the payment by the assessee-company to Messrs. Twin Disc. Company of U. S. A. in the respective previous years relevant to the assessment years 1970-71, 1971-72 and 1973-74 was a permissible deduction ?" For the assessment year 1970-71 only: " 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pheld by the Appellate Assistant Commissioner. However, on second appeal, the Tribunal allowed the claim as it found that admittedly the assessee's claim in regard to the payments made to Messrs. Hitachi was on facts similar to its claim in regard to Westing House Air and Signal Co. Ltd. which already had been allowed by it. In such circumstances, it was held by the Tribunal that the payments made by the assessee on account of cost of drawings to Messrs. Hitachi were also revenue expenditure. In the assessment for the assessment year 1973-74, the assessee made a claim for depreciation on capital assets used for scientific research related to its business. This claim also, though initially rejected by the Income-tax Officer, was allowed by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have considered the submissions. On perusal of the above decisions, we find force in the submission. We do not find any distinguishing feature in the present case justifying any deviation from the decisions of this court rendered in the assessee's own case in respect of earlier years on similar facts. Under the circumstances, it is difficult to hold that the aforesaid decisions are not applicable to the present case. Our attention was also drawn by learned counsel for the assessee to a recent decision of the Supreme Court in the case of Alembic Chemical Works Co. Ltd. v. CIT [1989] 177 ITR 377, in support of the contention that the expenditure in question should be held to be revenue expenditure. We have carefully considered the above de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of the art in some of these areas of high priority research is constantly updated so that the know-how could not be said to bear the element of the requisite degree of durability and non-ephemerality to share the requirements and qualifications of an enduring capital asset. " In view of the decisions of this court in the assessee's own case and the decision of the Supreme Court referred to above, we are of the clear opinion that the expenditure incurred by the assessee in the instant case by way of technical fees and drawing charges is revenue expenditure. The first three questions are, therefore, answered in the affirmative, that is in favour of the assessee and against the Revenue. So far as the fourth question is concerned, it is ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
