Dy. CIT v. I.P. Rings (P) Ltd.

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The Tax PublishersITA Nos. 3501, 3502, 3539 & 3540/CHNY/2018
2019 TaxPub(DT) 5162 (Chen-Trib)

INCOME TAX ACT, 1961

Section 37(1)

Issue as to apportionment of the royalty paid by assessee had already been adjudicated by Tribunal, in assessee's own case in (I.T.A. Nos. 2583 and 2584/Mds/2016, I.T.A. Nos. 2667 and 2668/Mds/2016, dt. 28-7-2017) for the earlier assessment years and CIT(A) had followed judicial discipline in following the decision of this Tribunal in assessee's own case, therefore appeal of Revenue was dismissed.

Business expenditure - Disallowance of royalty payment by treating 25% of royalty payment as capital expenditure and balance 75% as revenue expenditure - Allowability -

AO had disallowed royalty paid by assessee to a private limited company holding that 75% of the royalty payment was to be treated as revenue expenditure and 25% of royalty payment was to be treated as capital expenditure. However, CIT(A) deleted the action of AO. Held: Issue as to apportionment of the royalty paid by the assessee had already been adjudicated by Tribunal, in assessee's own case in (I.T.A. Nos. 2583 and 2584/Mds/2016, I.T.A. Nos. 2667 and 2668/Mds/2016, dt. 28-7-2017) for the earlier assessment years and CIT(A) had followed judicial discipline in following the decision of this Tribunal in assessee's own case, there was no reason to interfere in the order of CIT(A) and accordingly, appeal of Revenue was dismissed.

Followed:Apollo Tyres Ltd. v. Asstt. CIT., Range 1, Kochi in (ITA No. 616/Coch/2011, dt. 20-12-2013) : 2014 TaxPub(DT) 2378 (Coch-Trib) Southern Switch Gear Ltd. v. CIT (1998) 232 ITR 359 (SC) : 1998 TaxPub(DT) 1053 (SC) CIT v. IAEC (Pumps) Limited (1998) 232 ITR 316 (SC) : 1998 TaxPub(DT) 476 (SC)

REFERRED :

FAVOUR : In assessee's favour

A.Y. :

IN THE ITAT, CHENNAI BENCH