1993 (2) TMI 16

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.... SARAF J.-By this reference under section 256(1) of the Income-tax Act, 1961, made at the instance of the Revenue, the Income-tax Appellate Tribunal has referred the following question of law for opinion: "Whether, on the facts and in the circumstances of the case, and in law the Tribunal was justified in holding that the royalty payments to the three foreign concerns were not capital expenditu....

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....2, and March 11, 1964. The amounts paid to these foreign collaborators in the two years are as hereunder : In the accounting period relevant to the assessment year 1971-72: --------------------------------------------------------------------------------------------------------------------------------------------- Name of the Amount paid Payment under Amount foreign concern during agree....

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....--- --------------------- In the accounting period relevant to the assessment year 1972-73: --------------------------------------------------------------------------------------------------------------------------------------------- Name of the Date of Paid Disallowed by foreign concern agreement the ITO ------------------------------------------------------------------------------....

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....-------------------------------------------- It may be seen from the above figures that in regard to Trutzschler and Co., the Income-tax Officer held 25 per cent. of the royalty payment as in the nature of revenue expenditure and the balance 75 per cent. as capital expenditure. In the case of the other two foreign concerns, the entire royalty payment was disallowed by him as capital expenditure....