DCIT, CHENNAI V. M/s. Shriram Chits Tamilnadu Pvt.Ltd., CHENNAI

ITA 2743/CHNY/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7989 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 30-01-2017
• Assessment Year: 2013-2014
• Appeal Filed On: 22-09-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: H.KABILA
• Keywords: Revenue expenditure
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 92; 37(1)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, CHENNAI . . . , . . , BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER ./ ITA NO. 2743/MDS/2016 / ASSESSMENT YEAR : 2013-14 THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE 6(1), CHENNAI 600 034 V. M/S. SHRIRAM CHITS TAMILNADU PVT. LTD., GREAMS DUGAR, 4 TH FLOOR, NO.149, GREAMS ROAD, CHENNAI 600 006. PAN:AABCS0167N ( /APPELLANT) ( !' /RESPONDENT) # /APPELLANT BY : MS. H. KABILA, JCIT !' # /RESPONDENT BY : SHRI ANR JAYAPRATHA P, ADVOCATE # /DATE OF HEARING : 01.02.2017 # /DATE OF PRONOUNCEMENT : 10.02.2017 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST THE O RDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-15, CHENNAI DA TED 27.06.2016 AND PERTAINS TO THE ASSESSMENT YEAR 2013 -14. THE ONLY ISSUE ARISES FOR CONSIDERATION IS DISALLOWANCE OF R OYALTY PAID BY THE ASSESSEE. 2 I.T.A. NO. 2743/MDS/2016 2. MS. KABILA, THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE CLAIMED AN AMOUNT OF 74,68,980/- AS ROYALTY SAID TO BE PAID TO SHRIRAM OWNERSHIP TRUST. ACCORDING, TO THE LD. D.R., EVEN THOUGH, THIS TRIBUNAL FOUND THE PAYMENT ROYALTY AS A REVENUE EXPENDITURE, NOW THE APPEAL FILED BY THE REVENUE IS PENDING BEFORE THE HIGH COURT. THEREFORE, TO KEEP THE MATTER LIVE TO THE EXTENT OF 74,68,980/- WAS DISALLOWED AFTER ALLOWING DEPRECIAT ION OF 24,89,660/- AT THE RATE OF 25%. 3. ON THE CONTRARY SHRI ANR JAYAPRATHAP, THE LD. C OUNSEL FOR THE ASSESSEE SUBMITTED THAT THE VERY SAME ISSUE, ROYALT Y PAYMENT WAS ALLOWED BY THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2012-13 IN ITA NO. 373/MDS/2016 BY A N ORDER DATED 29.07.2016. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THIS TRIBUN AL IN THE ASSESSEES OWN CASE IN ITA NO. 373/MDS/2016 FOUND TH AT FOR USING THE LOGO WHICH BELONGS TO SHRIRAM OWNERSHIP TRUST, THE A SSESSEE HAS TO NECESSARILY MAKE PAYMENT. THE PAYMENT WAS MADE ON T HE BASIS OF THE TURNOVER. IN SIMILAR CIRCUMSTANCES, THIS TRIBU NAL FOUND THAT THE ROYALTY PAYMENT HAS TO BE ALLOWED AS REVENUE EXPEND ITURE UNDER 3 I.T.A. NO. 2743/MDS/2016 SECTION 37(1) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT). IN VIEW OF THE ABOVE, THIS TRIBUNAL IS OF THE CONSIDERED OPI NION THAT THE CIT (APPEALS) HAS RIGHTLY ALLOWED THE CLAIM OF THE ASSE SSEE. MERE PENDENCY OF THE APPEAL BEFORE THE HIGH COURT IS NOT A REASON FOR TAKING A DIFFERENT VIEW. THEREFORE, THIS TRIBUNAL D O NOT FIND ANY REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUTHORITY. ACCORDINGLY, THE SAME IS CONFIRMED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. ORDER PRONOUNCED ON 10 TH FEBRUARY, 2017 AT CHENNAI. SD/- SD/- ( . . ) ( . . . ) (D.S. SUNDER SINGH) (N.R.S. GANESA N) /ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, /DATED, THE 10 TH FEBRUARY, 2017. JR. # ! $ % $ /COPY TO: 1. /APPELLANT 2. !' /RESPONDENT 3. &' ( )/CIT(A)-15, CHENNAI 4. &' /CIT 5. ! $ /DR 6. () /GF.