TaxTMI 
TaxTMI 
2019 (8) TMI 650
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....d issues, all the four appeals are disposed of by this common order. 2. Shri R. Vijayaraghavan, represented on behalf of the assessee and Shri Clement Ramesh Kumar, represented on behalf of the Revenue. 3. In respect of the Revenue's appeal in Ground Nos.2.1 to 2.3 for the assessment year 2013-14 and 2.1 to 2.3 for the assessment year 2014-15, as also Ground Nos.2 to 2.3 of the assessee's appeal for the assessment year 2013-14 and Ground Nos. 2 to 2.3 of the assessee's appeal for the assessment year 2014-15, it was submitted by the Ld.AR that in the course of assessment, the Assessing Officer had disallowed royalty paid by the assessee to M/s. Nippon Piston Ring Co. Ltd., Japan. It was the submission that the Co-ordinate Bench of this Tribunal in the assessee's own case for the assessment years 1999-00, 2003-04 to 2005-06 and 2010-11 & 2011-12, had following the decision of the Hon'ble Supreme Court in the case of Southern Switchgear Ltd., reported in 232 ITR 359 (SC), held that 75% of the royalty payment was to be treated as revenue expenditure and 25% of the royalty payment was to be treated as capital expenditure and appropriate depreciation liable to be allowed. The findi....
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....issues are now squarely covered by the decision of the Co-ordinate Bench of the Tribunal in the assessee's own case, referred to, supra. 4. In reply, the Ld.DR supported the order of the Assessing Officer. It was the submission that the entire royalty payment is liable to be treated as capital expenditure. 5. We have considered the rival submissions. It is noticed that the issue as to apportionment of the royalty paid by the assessee to M/s. Nippon Piston Ring Co. Ltd., has already been adjudicated by the Co-ordinate Bench of this Tribunal, in the assessee's own case for the earlier assessment years and the Ld.CIT(A) has followed judicial discipline in following the decision of this Tribunal in assessee's own case for the earlier assessment years, we find no reason to interfere in the order of the Ld.CIT(A). Consequently, the same has been upheld. 6. In the result, Ground Nos.2.1 to 2.3 of the Revenue's appeal in ITA No.3539 & 3540/Chny/2018 for the assessment years 2013-14 & 2014-15 respectively and Ground Nos. 2 to 2.3 of the assessee's appeal in ITA No.3501 & 3502/Chny2018 for the assessment years 2013-14 & 2014-15 respectively, stands dismissed. 7. In respect of ....
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....to section 32(l)(iia) of the Act, the Assessing Authority ought not to have restricted the depreciation permissible under the said section by resorting to the second proviso to section of the Act. The learned counsel however fairly pointed out before us that in the second proviso to section 32(1) of the Act, that very clause (iia) itself was inserted by Finance Act, 2002 with effect from 01.04.2003. Therefore, it was imperative that on and after 01.04.2003, the claim of the assessee made under section 32(1)(iia) of the Act, had to be necessarily assessed by applying the second proviso to section 32(1) of the Act. Therefore, when there was statutory stipulation providing for restriction to 50 per cent of the amount allowable under section 32(1) (iia) of the Act, no fault can be found with the conclusion of the Assessing Authority as well as that of the Appellate Authority and the Tribunal in having affirmed the action of the Assessing Authority. We, therefore, do not find any scope to entertain the said question of law." 3.7 By considering the provisions of sections 32(1) and 32(1)(iia) of the Act, the Hon'ble Jurisdictional High Court has held that when there ....
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....ictional High Court in the case of Brakes India Ltd., supra and it is also noticed that the issue is now squarely covered by the decision of the Co-ordinate Bench of this Tribunal in the assessee's own case. In this circumstances, we find no reason to interfere in the order of the Ld.CIT(A) and the same stands upheld. Consequently, Ground Nos. 3.1 to 3.2 of Revenue's appeal for the assessment years 2013-14 & 2014-15 stands dismissed. In the result the appeals of the Revenue stands dismissed. 9. In respect of Ground No.3 of the assessee's appeal for the assessment year 2013-14 and 2014-15, it was submitted that the same was against the action of Ld.CIT(A) in confirming the disallowance of the deduction U/s.35(2AB). It was the submission that the R&D facilities in the case of the assessee have been applied by the DSIR for the purpose of the Section 35(2AB) and since the expenditure incurred towards the research is in respect of the approved project, the expenditure was liable to be allowed in full. It was the submission that even assuming that the claim is found inadmissible U/s.35(2AB) of the Act, still the assessee would be entitled to the benefit of the deduction U/s.35(1)(iv) ....