Spice Communications Ltd. (35 SOT 78) and CIT v. Modi Revlon Pvt. Ltd.

ACIT, CIRCLE 22(2), NEW DELHI vs. SNAPDEAL LTD., NEW DELHI

In the result, the appeal of the Revenue is dismissed

Bench: Shri G.S. Pannu, Hon’Ble & Ms. Astha Chandraasstt. Year: 2017-18

…o. 3175/Mum/2013), Asian Paints Ltd. vs. Addl. CIT (ITA 78Q1/MUM/2010), Fine Jewellery (I) Ltd. (19 ITR 746), Warner Lambert India Ltd. (ITA 954 & 3063/Mu m/2006), Delhi ITAT decisions in Spice Communications Ltd. (35 SOT 78) and CIT v. Modi Revlon Pvt. Ltd. (78 DTR 342). The judgment of Delhi High Court in CIT v. Adidas India Marketing (P.) Ltd. [2010] 195 Taxman 256 (Delhi) recognized that brand promotion exercises undertaken through media campaigns, Schemes, programmes etc are essential for propagation of the brand. The necessity (or lack of it) is not something which income tax authorities can go into; as lon…

ADDL. CIT, NEW DELHI vs. M/S. JASPER INFOTECH PVT. LTD., NEW DELHI

Bench: Ms Suchitra Kamble & Shri Prashant Maharishi(Through Video Conferencing)

…o. 3175/Mum/2013), Asian Paints Ltd. vs. Addl. CIT (ITA 78Q1/MUM/2010), Fine Jewellery (I) Ltd. (19 ITR 746), Warner Lambert India Ltd. (ITA 954 & 3063/Mu m/2006), Delhi ITAT decisions in Spice Communications Ltd. (35 SOT 78) and CIT v. Modi Revlon Pvt. Ltd. (78 DTR 342). The judgment of Delhi High Court in CIT v. Adidas India Marketing (P.) Ltd. [2010] 195 Taxman 256 (Delhi) recognized that brand promotion exercises undertaken through media campaigns, Schemes, programmes etc are essential for propagation of the brand. The necessity (or lack of it) is not something which income tax authorities can go into; as lon…

M/S. GL LITMUS EVENTS PVT. LTD.,NEW DELHI vs. ACIT, NEW DELHI

Appeal of the assessee is partly allowed

Bench: Shri Prashant Maharishi & Shri K. N. Charygl Litmus Events Pvt. Ltd, The Assistant Commissioner Vs. B-90, Second Floor, Of Income Tax Vishwakarma Colony, New Delhi Central Circle-7, New Delhi Pan: Aadcg6909N (Appellant) (Respondent)

…ter concern is in excess of the fair market value of the services rendered but has proceeded purely on assumptions. Such an action on the part of the AO is unsustainable in the eyes of law. Honourable Delhi High court in CIT Vs. Modi Revlon (Pvt.) Ltd. (2012) 78 DTR 342 (Delhi) has held that in order to determine whether the payment is not sustainable, the AO has to first return a finding that the payment made is excessive, under Section 40-A (2) of the Income Tax Act. If it is found to be so, then the AO has to determine what constitutes the fair market value of the services rendered and disallow the difference…

ACIT, NEW DELHI vs. M/S. YKK INDIA PVT. LTD., NEW DELHI

In the result, while the appeal of the assessee is allowed, the cross-objection filed by the assessee as also the appeal filed by the revenue is dismissed

…e 7 of 7 know how but the royalty is computed with reference to the net sale proceeds which clearly shows that the linkage is with revenue generated by the assessee. As noted by Hon’ble jurisdictional High Court, in the case of CIT Vs Modi Revlon Ltd. [(2012) 78 DTR 342 (Del)], “there is nothing in the agreement suggestive of any vesting of the know-how, or part of it, or the goodwill in the brand, in the licensee/ assessee. In these circumstances, this Court is of the opinion that the revenue's arguments about the royalty amount being really in the nature of capital expenditure, is meritless”. What is material i…

YKK INDIA (P) LTD vs. ITO WARD-18 (3),

In the result, while the appeal of the assessee is allowed, the cross-objection filed by the assessee as also the appeal filed by the revenue is dismissed

…e 7 of 7 know how but the royalty is computed with reference to the net sale proceeds which clearly shows that the linkage is with revenue generated by the assessee. As noted by Hon’ble jurisdictional High Court, in the case of CIT Vs Modi Revlon Ltd. [(2012) 78 DTR 342 (Del)], “there is nothing in the agreement suggestive of any vesting of the know-how, or part of it, or the goodwill in the brand, in the licensee/ assessee. In these circumstances, this Court is of the opinion that the revenue's arguments about the royalty amount being really in the nature of capital expenditure, is meritless”. What is material i…