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TMI Blog2017 (11) TMI 1362X X X X Extracts X X X X X X X X Extracts X X X X ..... is regard the Ld. DR could not controvert the finding that whether against the order of Ld. CIT(A) for A.Y. 2008-09 and 2009-10 for G4S Pvt.Ltd. the appeal has been filed in upper forum or not. The Ld. CIT(A) has also observed that for the A.Y. 2008-09 and 2009-10 in the assessee’s own case on identical facts and circumstances had allowed the appeal of the assessee. But the Ld.DR could not controvert whether revenue has filed any appeal against such order. In the case of group companies the Hon’ble High Court has allowed the royalty payment as revenue expenditure in the case of assessee group companies. - Decided against the revenue. - ITA No. 5558/Del/2014 - - - Dated:- 3-10-2017 - SHRI H.S.SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACC ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reement is as under. In this agreement, the following words and expressions shall have the meanings hereby assigned to them: Effective date means January 1, 2007, License business means the business carried on by the license as described in Schedule 2, to which this agreement applies. Royalty agreement means the agreement dated December 26, 2007 made between G4S and the licensor, relating to the use by the licensor of the trade marks and trade names in the territory. Trade names means the trade names listed in schedule 3. Trade marks means the trademarks and logos listed in schedule 1. In consideration of the sub license the license shall throughout the term of this agreement after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pronouncements in this regard, Vide my order dated 29.11.2 12 in appeal No.113/11-12/CIT{A)XV, Hon'ble Delhi High Court in the case of another group company, i.e. M/s G- 4S Securities Services, on identical facts, has already dismissed the depart rental appeal in earlier years and held the royalty payment as revenue expenditure, after considering the facts and legal position. 6.2 The facts of that case are similar to the following facts of appellant, which as per the term of the present agreement, provide that: ( i) The appellant company was engaged in the service Industry instead of engaged in the manufacturing activities. ( ii) Since in the service industry, technology changes at rapid pace than manufacturing acti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red view that the Ld. First Appellate Authority has rightly deleted the addition made by the A.O. because these royalty payments are paid for use of trademark licences. After going through the impugned order the Ld. CIT(A) has observed that in case of group companies (G4S Security Systems) in the A.Y. 2002-03, 2003-04 and 2005-06 has been rightly allowed by Hon ble High Court after appreciating the legal and factual position and in case of G4S Pvt.Ltd. in the A.Y. 2008-09 and 2009-10 the Ld. CIT(A) himself has allowed the appeal of the assessee and in this regard the Ld. DR could not controvert the finding that whether against the order of Ld. CIT(A) for A.Y. 2008-09 and 2009-10 for G4S Pvt.Ltd. the appeal has been filed in upper forum or n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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