2002 PTD 1096

Case Laws / Head Notes / Paras

Business expenditure--Royalty payable to State Government-State > Government having unilateral power to fix royalty:-Dispute regarding enhancement of royalty and lack of entry in accounts-Not relevant Enhanced royalty is a statutory liability-Deductible Indian Income Tax Act, 1961, S.37.The assessee-company was engaged in the manufacture and sale of paper. The main raw materials used by the assessee for manufacture of paper were eucalyptus wood and pine wood. The said raw materials were obtained from the forests of the Government of Uttar Pradesh. The terms and conditions on which such raw materials were supplied by the Government of Uttar Pradesh were that the assessee would pay the royalty as would be determined by the Government. Initially, royalty on eucalyptus wood supplied by...