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Income Tax - Highlights / Catch Notes

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Nature of royalty expenses - the Agreement in question was ...

Income Tax

June 13, 2017

Nature of royalty expenses - the Agreement in question was crucial for setting up of the plant project in question for manufacturing of the goods, the expenditure in the form of royalty paid would be in the nature of capital expenditure and not revenue expenditure - SC

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  1. Capital or revenue expenses - Disallowance of royalty - if there is no sales, no royalty is payable by the assessee - held as revenue in nature - AT

  2. The expenditure incurred by the assessee towards royalty and fee for technical assistance in pursuance of the licence agreement were revenue expenditure and not capital...

  3. The expenses incurred are in the nature of employee benefits, though paid under secondment agreement, in respect of persons working for the assessee - Expenses are...

  4. TDS u/s 195 - Taxability as royalty or FTS - the payment in question made was towards reimbursement or expenses and not reimbursement of service - HC

  5. Nature of expenditure - revenue or capital - In order to carry on their business, they were in need of herbal coleus plants. they thought of roping the farmers for...

  6. Various expenses incurred prior to setting up of Plant and machinery - the expense which have been incurred by the assessee prior to setting up the plant and machinery...

  7. Excisability/marketability - ducts - fabrication of Ducts during the process of execution - air-conditioning plant was in the nature of a system and not machinery or...

  8. Rehabilitation expenses – Revenue or capital - evacuation from the danger zone has been done in accordance with the lease agreement and in discharge of the statutory...

  9. Valuation - related party transaction - know how agreement - it was considered that royalty is not the condition of sale of the imported goods, royalty not included - AT

  10. During the period of dispute, the renting of plant & machinery by the appellant under lease agreement/licence agreement was not taxable as Banking and Financial Services - AT

 

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