2023 (11) TMI 121

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.... The appeal filed by the Revenue is delayed by 34 days in filing the appeal, for which, the Revenue has filed an affidavit for condonation of the delay, to which; the ld. Counsel for the assessee has not raised any serious objection. Consequently, since the Revenue was prevented by sufficient cause, the delay in filing of the appeal stands condoned and the appeal is admitted for adjudication. 3. Brief facts of the case are that the assessee filed its return of income for the assessment year 2013-14 on 29.11.2013 admitting an income of Rs..35,83,71,010/- and subsequently filed its revised return of income on 04.08.2014 admitting an income of Rs..27,75,71,595/-. The return was taken up for scrutiny under CASS and notice under section 143(2....

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....sed the assessment order as well as appellate order. In the assessment order, the Assessing Officer has observed that the expenditure towards payment of royalty is capital in nature and hence not allowable as revenue expenditure. However, by following various decision of the Tribunal in assessee's own case for earlier assessment years, the ld. CIT(A) directed the Assessing Officer to delete the addition made on account of royalty payment. We have perused the case law relied on by the ld. Counsel for the assessee in ITA No. 1687/Chny/2018 for the assessment year 2012-13 vide order dated 04.04.2022 in assessee's own case, wherein, the Tribunal has observed and held as under: 4.2 We find that similar issue stood covered in assessee's ....

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....xpenditure could not be regarded as capital expenditure by any stretch of imagination. The Ld. CIT(A), upon perusal of factual matrix, concurred with assessee's submissions and observed that the payment was as license fees only and not price for acquisition of any capital assets. The ratio of decision of Hon'ble Apex Court in Alembic Chemicals Works Co. Ltd. (177 ITR 377) was noted wherein similar expenditure were held to be allowable deduction. Similar was the decision of Hon'ble Delhi High Court in Jubilant Foodwork Pvt. Ltd. (52 Taxmann.com 215) wherein it was held that the franchise fees paid annually at fixed percentage of sales turnover for using trademark would be revenue expenditure. Similar was the decision in Hero Honda Motors Ltd....