The tribunal held that royalty paid by the assessee in the nature of spectrum charges to Government of India as a percentage of revenue on regular basis as also the license fee paid for telecommunication services to Government of India based on revenue share on regular basis were revenue expenditure allowable as deduction and that section 35ABB was not applicable. (AY. 2009-10)
Dy. CIT v. Vodafone Essar Digilink Ltd. (2018) 193 TTJ 150 / 64 ITR 392/ 170 ITD 430 / 166 DTR 233 (Delhi)(Trib.)
S. 37(1) : Business expenditure – Capital or revenue-Royalty paid in the nature of spectrum charges to Government of India as a percentage of revenue on regular basis – Also, license fee paid for telecommunication services to Government of India based on revenue share and on regular basis – Held, both are revenue expenditure – S. 35ABB is not applicable.[S.35ABB]