TMI Blog2021 (3) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of the agreement and held that the know-how was to remain the sole and exclusive property of the provider and the appellant company is required to fully exploit the same. Technical know-how was also in relation to the sales affected by the assessee company, it Is also required to be noted that assessee is engaged in the same business for which technical know-how is by the assessee and it is not at its an altogether a new line of business which is developed. DR could not point out any infirmity in the order of the Ld. CIT(A). In view of above facts we do not find any reason to disturb the finding of the Ld. CIT(A) in allowing the claim of the assessee of technical know-how fees paid to its parent company as revenue in nature - Decided ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid to its parent company M/s. Voith Paper Fabrics Gmbh Co. KG even when it is apparent from the aim and objective of the technical knowhow agreement and the nature of services rendered that right to use of the know-how was an integral part of profit making process and brought enduring benefits to its business. (ii) That the appellant craves for the permission to add, delete or amend the grounds of appeal before or at the time of hearing of appeal. 5. During the course of assessment proceedings, AO noted that assessee had debited ₹ 3,10,29,391/- as 'Technical Know How Fees/Royalty'. The assessee was asked to explain as to why the aforesaid expenses not be capitalized. Assessee made the submissions which were not fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re held by him as capital expenditure and thus made net disallowance of ₹ 2,75,56,983/-. 6. Aggrieved by the order of AO, assessee carried the matter before the CIT(A) who after noting the fact that the issue in the year under consideration are identical to that of A.Y. 2010-11 2011-12 and following the orders of earlier years allowed the claim of the assessee. Aggrieved by the order of CIT(A), Revenue is now before us. 7. Before us, Learned DR supported the order of AO and further submitted that against the order of the Tribunal, Revenue has preferred appeal in the High Court and the matter is yet to be decided. 8. Learned AR on the other hand, placed on record the copy of the Tribunal order for A.Y. 2009-10, 2010-11, 2011 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 9819356/- on account of technical know-how is fees paid to the parent company of the assessee which was held by the Ld. AO as capital expenditure and whereas the claim of the assessee is that it is revenue expenditure. 17. The Ld. departmental representative vehemently retied upon the order of the Ld. assessing officer, it was vehemently contested that technical know-how fees paid by the assessee is a capital expenditure in nature the assessee in exploiting it for the purpose of manufacturing of the goods. H was therefore submitted that the technical know-how is purchased by the assessee from its company. 18. The Ld. Authorized 'representative relied upon order of the Ld. CIT(A). He further relied upon the agreement d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the order of the Ld. CIT(A). In view of above facts we do not find any reason to disturb the finding of the Ld. CIT(A) m allowing the claim of the assessee of technical know-how fees paid to its parent company as revenue in nature, in the result ground No. 3 of the appeal of the revenue is dismissed. 5. Respectfully following the findings of the co-ordinate bench, we Line to interfere with the finding of the ld. CIT(A). Appeals filed by' Revenue are accordingly dismissed. 10. Before us, no distinguishing feature in the facts of the case in the year under consideration has been pointed out by the Revenue. Further no fallacy in the findings has been pointed out by the Revenue before us. Revenue has also not placed any mate ..... X X X X Extracts X X X X X X X X Extracts X X X X
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