The Pr. Commissioner of Income-tax-4 v. Henkal Teroson India Ltd
[Citation -2017-LL-0228-249]

Citation 2017-LL-0228-249
Appellant Name The Pr. Commissioner of Income-tax-4
Respondent Name Henkal Teroson India Ltd.
Court HIGH COURT OF DELHI AT NEW DELHI
Relevant Act Income-tax
Date of Order 28/02/2017
Judgment View Judgment
Keyword Tags expenditure incurred • capital expenditure • material on record • technical know-how
Bot Summary: CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI ORDER 28.02.2017 The solitary question of law urged by the Revenue in this appeal under Section 260A of the Income Tax Act, 1961 is with respect to the treatment of expenditure incurred by the assessee, i.e. towards payments of technical know-how fee. The Assessing Officer brought the amount to tax by treating it as a capital expenditure holding that it resulted in an enduring advantage. The Commissioner of Income Tax CIT and the Income Tax Appellate Tribunal, concurrently overruled the AO s finding holding that the technical know-how fee was payable for a limited duration and that with the cessation of the agreement, such payments automatically had to stop and that consequently the expenditure properly had to be treated in the Revenue s stream. The Court is of the opinion that no substantial question of law arises; the material on record also discloses that for previous years, similar expenditure was treated as a Revenue expenditure.


$ 12 * IN HIGH COURT OF DELHI AT NEW DELHI + ITA 115/2017 PR. COMMISSIONER OF INCOME TAX-4 ..... Appellant Through: Mr. Ruchir Bhatia, Advocate. Versus M/S HENKAL TEROSON INDIA LTD. ..... Respondent Through: Mr. Gaurav Jain and Ms. Bhavita K., Advocates. CORAM: HON'BLE MR. JUSTICE S. RAVINDRA BHAT HON'BLE MR. JUSTICE NAJMI WAZIRI ORDER % 28.02.2017 solitary question of law urged by Revenue in this appeal under Section 260A of Income Tax Act, 1961 is with respect to treatment of expenditure incurred by assessee, i.e. towards payments of technical know-how fee. Assessing Officer (AO) brought amount to tax by treating it as capital expenditure holding that it resulted in enduring advantage. Commissioner of Income Tax (Appeals) [CIT (A)] and Income Tax Appellate Tribunal (ITAT), concurrently overruled AO s finding holding that technical know-how fee was payable for limited duration and that with cessation of agreement, such payments automatically had to stop and that consequently expenditure properly had to be treated in Revenue s stream. Court is of opinion that no substantial question of law arises; material on record also discloses that for previous years, similar expenditure was treated as Revenue expenditure. appeal is, therefore, dismissed. S. RAVINDRA BHAT, J. NAJMI WAZIRI, J. FEBRUARY 28, 2017 sb Pr. Commissioner of Income-tax-4 v. Henkal Teroson India Ltd
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