CIT vs. DHARAMPAL SATYAPAL LTD

IN THE HIGH COURT OF DELHI AT NEW DELHI . 05.09.2011 . . . Present: Mr. Sanjeev Sabharwal, Advocate for the appellant. . Dr. Rakesh Gupta with Mr. Ashwani Taneja and Ms. Rani Kiyala, Advocates for the respondent. . . . +ITA 1040/2011 . . . The issue raised in this appeal pertains to royalty expenses paid by the assessee and the question is as to whether the same is revenue expenditure or capital expenditure. It is not in dispute that this expenditure has always been shown as revenue in nature and in the previous years also, it has been accepted as such. It would be relevant to state that in respect of two assessment years, the Tribunal upheld this very expenditure to be revenue expenditure. Challenging this order of the Tribunal, the revenue has filed ITAs 1290/2010 and 1291/2010 which were withdrawn by the revenue with liberty to file properly instituted appeals but no appeal was thereafter filed which amounts to accepting the decision of the Tribunal. . Other issue which is raised in this appeal relates to restricting the disallowance of Rs.12,02,547/- as against Rs.18,26,988/- made by the Assessing Officer under Section 14A read with Rule 8D of the Act. In fact, the Assessing Officer had disallowed the amount to the extent of Rs.18.26 lakhs which was reduced to Rs.12.02 lakhs by the CIT(A) and therefore the order of CIT(A) has been upheld by the Tribunal. On the facts of this case, we are not inclined to interfere with the order of ITAT keeping the question of law open on this aspect. The appeal is, otherwise, dismissed. . . . A.K. SIKRI, J. . . . . . . . J.R. MIDHA, J. . . . September 05, 2011/awanish . . . #46 to 51 .