Royalty expense allowable when goods are sold to Associated Enterprise on principal-to-principal basis

Honda Motorcycle and Scooters India Pvt. Ltd. Vs DCIT (ITAT Delhi) Facts- The appellant, Honda Motorcycle and Scooters India Pvt. Ltd., is a subsidiary of Honda Motor Company Ltd., Japan. As per the agreement, the assessee is liable to pay the royalty of goods manufactured. Conclusion- Royalty payment- It is not in dispute that the goods which are exported by the assessee were manufactured using the technical know-how provided by Honda Motor Company Ltd., Japan under an agreement dated 13th July 2000. The assessee has sold the goods to the Associated Enterprise on principal to principal basis ...