Payment of Royalty for Purchasing Right to Re-Produce Film-Music is a Revenue Expense

Saregama India Ltd. Vs DCIT (ITAT Kolkata)

The issue under consideration is whether payment of minimum guarantee royalty for purchasing right to reproduce film-music is considered as capital expense or revenue expense?

ITAT states that, the nature of business of the assessee in the present case, it cannot be disputed that music is a raw material in the case of the assessee, a fact which has been confirmed by the Tribunal in A.Y 1984-85. It purchases music on payment of roy

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