https://www.taxtmi.com/caselaws?id=11259 The High Court of MADRAS ruled that a payment made by the assessee to a foreign collaborator for technical know-how cannot be considered a revenue expenditure under section 37 of the Income-tax Act. The court held that such expenditures must be governed by section 35AB, with deductions allowable as one-sixth of the payment for acquiring know-how. The court emphasized that the entitlement for deduction is based on the year of payment, irrespective of subsequent events. Consequently, the appeal was allowed in favor of the Revenue, affirming the application of section 35AB for the deduction claimed. en-us Tue, 02 Dec 2003 00:00:00 +0530 Mon, 03 Aug 2009 11:48:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=11259 The High Court of MADRAS ruled that a payment made by the assessee to a foreign collaborator for technical know-how cannot be considered a revenue expenditure under section 37 of the Income-tax Act. The court held that such expenditures must be governed by section 35AB, with deductions allowable as one-sixth of the payment for acquiring know-how. The court emphasized that the entitlement for deduction is based on the year of payment, irrespective of subsequent events. Consequently, the appeal was allowed in favor of the Revenue, affirming the application of section 35AB for the deduction claimed. Case-Laws Income Tax Tue, 02 Dec 2003 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=11259