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TMI Blog2012 (7) TMI 805X X X X Extracts X X X X X X X X Extracts X X X X ..... as been made on turnover basis, the expenditure has to be treated revenue in nature - no substantial question of law arises for consideration - ITA 397/2012 & CM APPL.11598/2012 - - - Dated:- 24-7-2012 - MR. JUSTICE S. RAVINDRA BHAT, MR. JUSTICE R.V. EASWAR, MR. JUSTICE S.RAVINDRA BHAT, JJ. For Appellant: Mr. Sanjeev Sabharwal, Sr. Standing Counsel with Mr. Puneet Gupta, Jr. Standing Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed expenditure of 25% of the royalty actually paid. The Tribunal relied upon the decisions of this Court in case of CIT v. Sharda Motor Industries Ltd. 319 ITR 109 (Del) and CIT v. J.K. Synthetics Ltd. 309 ITR 371 (Del). 4. In Para 6 of the impugned order, the Tribunal s reasoning can be found. The relevant extracts are as follows:- 6. We have heard both the parties and gone through the mater ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take every precaution to ensure that no information is otherwise disclosed by its employees and suppliers to other parties. From the terms of the agreement the ld. CIT (A) came to the conclusion that technical information and patents provided by foreign collaborator to the assessee were in the nature of license which provided access to technical knowledge and it was not an absolute transfer of te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sonnel was in the nature of revenue expenditure. Since in the instant case assessee had right to access the technical knowledge as against absolute transfer of technical knowledge and information and the payment for which has been made on turnover basis, the expenditure has to be treated revenue in nature. Therefore, in our considered opinion, the ld. CIT (A) has rightly allowed the claim of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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