https://www.taxtmi.com/caselaws?id=445230 The ITAT Chennai dismissed the Revenue's appeal regarding royalty payment classification. The assessee paid royalty based on annual sales turnover for using trade name and management services under contractual terms. Upon agreement termination, all benefits and licenses would lapse, requiring return of materials. Since no new asset was acquired and the assessee merely acted as user without acquiring enduring rights, the CIT(A) correctly treated the royalty as revenue expenditure rather than capital expenditure. The tribunal upheld this decision following its own precedent from assessment year 2012-13. en-us Tue, 31 Oct 2023 00:00:00 +0530 Fri, 03 Nov 2023 13:40:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=445230 The ITAT Chennai dismissed the Revenue's appeal regarding royalty payment classification. The assessee paid royalty based on annual sales turnover for using trade name and management services under contractual terms. Upon agreement termination, all benefits and licenses would lapse, requiring return of materials. Since no new asset was acquired and the assessee merely acted as user without acquiring enduring rights, the CIT(A) correctly treated the royalty as revenue expenditure rather than capital expenditure. The tribunal upheld this decision following its own precedent from assessment year 2012-13. Case-Laws Income Tax Tue, 31 Oct 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=445230