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TMI Blog2016 (10) TMI 1379X X X X Extracts X X X X X X X X Extracts X X X X ..... n not treating product registration charges as capital expenditure. 1.2 On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in holding that product registration charges are not creating any new assets, whereas it is nothing but license / business or commercial right which comes under definition of intangible assets. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in admitting additional evidences in respect of purchases made from M/s. Harsh Chemicals which was not submitted before AO during course of assessment proceedings, and thus not observing / following provisions of Rule 46A(3) of the I.T.Rules. 3. The brief facts of the case are that the assessee filed his r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en up for adjudication. Under this issues the revenue has challenged the sole point that the CIT(A) has wrongly allowed an amount of Rs.43,06,904/- as revenue expenditure whereas the same should be considered as capital in nature. Before going further it is necessary to advert the finding of the CIT(A) on record:- "2.3 I have carefully considered the submission of the appellant and the impugned assessment order. The AR of the appellant had filed copies of Registration Certificate issued by Health and Drug administration of various countries such as Zambia, Ghana, Georgia, Vietnam, Nigeria, Ukrain, etc. with the registration number and the details of product and expiry period of the license. The fees is paid towards vendor registration, qu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enses, when the expense were incurred for registration of Trademark in that country and also for registration of Patent, which are intangible assets under section 32(1)(ii) of the Act? These questions pertain to the expenditure incurred by the assessee towards product registration before the Drug Regulatory Authorities and registration of trademark and patent fees. It is the case of the Revenue that such registration gives enduring benefits and therefore should have been treated as capital expenditure and not revenue in nature. The Tribunal clubbed these expenditure for common consideration and in the impugned judgment held that pharmaceutical products manufactured by the assessee are to be registered with the local authorities as also m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Further in my opinion test of enduring benefit alone cannot be a deciding factor that the expenditure incurred in capital in nature. Hence, I do not accept the finding of the AO. I direct the AO to treat the expenditure incurred towards registration charges as revenue and in view of this, the addition made by the AO is hereby deleted. This ground of appeal is allowed." 5. On appraisal of the above said order it came into the notice that the assessee filed the copies of registration certificate issued by the Health and Drug administration of various countries such as Zambia, Ghana, Georgia, Vietnam, Nigeria, Ukrain, etc. with the registration number and the details of products and expiry period of the license. The fees were paid towards ..... X X X X Extracts X X X X X X X X Extracts X X X X
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