2002 (7) TMI 73

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....SUBRAMANIAN J.-The question referred to us under section 256(1) of the Income-tax Act, 1961, at the instance of the Revenue in relation to the assessment year of the assessee 1983-84 is as under: "Whether, on the facts and in the circumstances of the case, the royalty paid to the director as a proprietor of the trade mark could be treated as a benefit derived by a director within the meaning of....

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....d this court has held that the payment of royalty was paid to the directors not in the capacity of directors but as a proprietor of the trade mark and it cannot be treated as benefit which can be disallowed under section 40(c) of the Act. We also find that the Supreme Court has taken a similar view in the case of Bharat Beedi Works (P.) Ltd. v. CIT [1993] 201 ITR 1063, wherein the Supreme Court ha....