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TMI Blog2012 (9) TMI 1057X X X X Extracts X X X X X X X X Extracts X X X X ..... Standing Counsel Respondent by : Shri M. Viswanathan, CA O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER : These are appeals filed by the Revenue against a consolidated order dated 26.3.2012 of Commissioner of Income Tax (Appeals)-XII, Chennai, for the impugned assessment years. Sole grievance raised by the Revenue in these appeals are that CIT(Appeals) held royalty payments effected by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t years 1999-2000 to 2002-03 as also in assessment year 2004-05. In its order dated 17th June, 2011 for assessment year 2004-05 in I.T.A. No. 951/Mds/2009, it was held by co-ordinate Bench of this Tribunal as under:- "7. We have perused the orders and heard the rival contentions. We find that the same issue regarding royalty payment made to M/s COCL was considered by this Tribunal in the orders r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nning royalty payable has no nexus or direct connection with the manufacture of the product. The liability to pay the royalty arises only when there is a sale. Therefore, we are of the view that the running royalty cannot be said to be a capital expenditure. We do not find any rationale in bifurcation of the running royalty and treating one part as capital and the other part as revenue by the lear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee for assessment year 2004-05 stands allowed, whereas, the related ground of the Revenue stands dismissed." 5. Thus, this Tribunal had followed its own order for earlier assessment years on the same issue. We are, therefore, of the opinion that CIT(Appeals) was well justified in treating the royalty payments made to M/s Chevron Oronite Company LLC USA as nothing but revenue expenditur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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