https://www.taxtmi.com/caselaws?id=69565 Royalty paid for the right to reproduce film songs in pre-recorded cassettes was treated as revenue expenditure, not capital expenditure. Although the agreement used the word "assign," the surrounding terms showed that the producers retained relevant rights, the payment was calculated as a percentage of sales, and the arrangement operated as a licence rather than an assignment of copyright. Because the outlay was variable, tied to production and sales, and did not secure ownership of a capital asset or enduring advantage, section 35A did not apply and the expenditure was deductible in full. en-us Thu, 11 Jun 1992 00:00:00 +0530 Thu, 07 Apr 2011 16:37:12 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=69565 Royalty paid for the right to reproduce film songs in pre-recorded cassettes was treated as revenue expenditure, not capital expenditure. Although the agreement used the word "assign," the surrounding terms showed that the producers retained relevant rights, the payment was calculated as a percentage of sales, and the arrangement operated as a licence rather than an assignment of copyright. Because the outlay was variable, tied to production and sales, and did not secure ownership of a capital asset or enduring advantage, section 35A did not apply and the expenditure was deductible in full. Case-Laws Income Tax Thu, 11 Jun 1992 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=69565