DCIT, NEW DELHI vs. M/S. HONDA SIEL POWER PRODUCTS PVT. LTD., UTTAR PRADESH

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ITA 3907/DEL/2015Status: DisposedITAT Delhi10 December 2018AY 2003-043 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal dismissed the revenue's appeal, holding that the royalty expenses were revenue in nature. This decision followed the consistent view of the Hon'ble Delhi High Court in the assessee's own case for earlier and subsequent years.

What were the facts?

The Assessing Officer disallowed royalty expenses of Rs. 2,11,67,250/- treating them as capital in nature. The CIT(A) deleted this addition, relying on previous High Court decisions for the assessee.

What were the issues?

Whether royalty expenses paid for technical collaboration are capital or revenue in nature. Whether the Hon'ble Delhi High Court's decision on similar issues for the assessee in earlier years binds the Tribunal.

Which sections of the Income-tax Act were involved?

Section 143(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “F”: NEW DELHI

Before: SHRI AMIT SHUKLA & SHRI PRASHANT MAHARISHI

For Appellant: Shri Neeraj Kumar Jain, Adv, Ms. Shaily Gupta, CA
For Respondent: Shri Surender Pal, Sr. DR, Shri Neeraj Kumar Jain, Adv, Ms. Shaily Gupta, CA
Hearing: 04/10/2018Pronounced: 10/12/2018

O R D E R PER PRASHANT MAHARISHI, A. M. 1. This is an appeal filed by the revenue against the order of the ld CIT(A)-4, New Delhi dated 30.03.2015 for the Assessment Year 2003-04. 2. The revenue has raised the following grounds of appeal:-

1. Whether on the facts and circumstances of the case & in law, the ld CIT(A) erred in deleting the disallowance of Rs. 2,11,67,250/- made on account of capitalization of royalty expenses.”

3.

Brief facts of the case shows that the assessee company filed its return of income declaring total income of Rs. 197319896/- on 27.11.2003. the assessment under section 143(3) of the Act was passed on 01.10.2009, wherein, the ld AO made disallowance of Rs. 21167250/- on account of royalty expenses paid held to be of capital nature. The income was assessed at Rs. 234470158/-. The assessee preferred appeal before the ld CIT(A) who passed the order dated 30.03.2015 deleting the above addition relying on the decision of the Hon'ble Delhi High Court in case of assessee for Assessment Year 2000-01 to 2002-03. Page | 1

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