The concept of prior period expenses cannot be applied in the ...

Expenditures for acquiring IPR must be treated as revenue expenses and matched against sales revenue, not as prior period costs.

April 12, 2018

Case Laws Income Tax AT

The concept of prior period expenses cannot be applied in the instant case, since the assessee has acquired the rights over the IPR over a period. Under revenue cost matching principle, all the expenditure incurred in acquiring IPR have to be treated as revenue expenditure irrespective of the year in which it was incurred and has to be allowed against sales revenue of IPR. - AT

View Source

← Previous Next →

The concept of prior period expenses cannot be applied in the ...

Expenditures for acquiring IPR must be treated as revenue expenses and matched against sales revenue, not as prior period costs.

April 12, 2018

Case Laws Income Tax AT

You may also like:

ITAT allowed assessee's claim for deduction of marketing expenses paid to NHPL, treating them as revenue expenditure. The expenses related to sales personnel salaries,...

Sales promotion expenses - expenditure with respect to the gold chains being distributed - expenditure allowed - AT

Nature of expenses - Relaunch expenses - deferred revenue expenditure claimed to the extent of 1/3rd in each of the year -The tribunal disagreed with the AO's...

Revenue expenditure or capital expenditure - Allowability of expenses on acquisition of clientele and technical human resource i.e., employees to execute the contract -...

Bond issue expenses - Capital or revenue in nature - held as revenue expenditure - AT

ITAT affirmed weighted deduction eligibility u/s 35(2AB) for in-house scientific research expenditure. While R&D expenses incurred within India qualify for weighted...

Disallowance of prior period expenditure - Mercantile system - Matching principles of accounting - The assessee had claimed deduction for such expenses, citing a...

Disallowance of contingency expenses claimed by the assessee. The Assessing Officer (AO) disallowed the contingency expenses despite acknowledging that the total cost...

Allowable business expenses - There is difference between commencement of the business and setting off of the business. All the expenses incurred pre-commencement are to...

Prior period expenditure - Whether Tribunal is right in holding that the expenditure was crystalized during the relevant previous year when the assessee hijmself has...

Foreign travelling expenses incurred for purchase of Machinery from outside India cannot be treated as Capital Expenditure rather treated as Revenue Expenditure only for...

Nature of expenses - Litigation expenses - Revenue or capital expenditure - In the present facts, since assessee has no interest in the ownership of the asset but he is...

Royalty paid treated as capital expenses - the assessee company did not obtain any proprietary or ownership right of trademark or knowhow, no asset was created or...

Nature of expenditure - the amount paid by assessee to ITC Limited at the time of termination of the agreement to manage the hotel, ought to be allowed, as a revenue...

Nature of Interest income - first ground of appeal of the assessee for treating expenses to the amount as revenue expenditure is dismissed. However, the alternative...

Quick Updates: