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c. The agree ment further stated that the assessee shall enter into the technical assistance agreement with JX NOE pursuant to which the JX NOE shall grant to the transferee a royalty bearing the right and license to use JX NOE technology, knowhow and trademarks to manufacturing)including tho ugh toll manufacturing by the transferor). Market, distribution and/or sell the licensed products with a right to sub lice nse the use of technical information, knowhow and trade marks to the transfe ror and the other authorized sub licenses approved by JX NOLI (Reliance is placed on Para 2.4 (b) of the business transfer agreement).

d. Vide Para 2.4(h) of the. Business transfer agree ment, it is inferred that the transfe ror and transferee ente r into the franchisee agreement for reorganization and conduct of the SF oils business pursuant to which the transferee shall appoint the transferor as its industrial franchisee of the SF oils Business and. grant to the transferor a franchisee fee bearing right and sub license to use JX NOE technology and kno whow (and trademark for the SF oils branded with JX NOE trademarks) to 'manufacture, sell and distribute in JX Nippon Two Lubricants India Pvt. Ltd.

f. Here, it is pertinent to note the role of JX NOE which is always being the party to the business purchase agreement and entails that it wo uld provide all the intellectual property support be in the nature of knowho w, trademarks, patents, technology to manufacturing the SF or FF lubricant oils.

14. The Assessing Officer pointed out that under the business agreement, the "Two" had transferred business segme nt namely "Eneos Business Segment (EBS) to the assessee and observed that the Eneos brand was in fact owned by JX NOE, Japan since its incorporation. The Assessing Officer also referred to the valuation report provided by the assessee and pointed out that the valuation re port did not contain any analo gy regarding the commercial rights which "Two" who was having. The Assessing Officer pointed out that the assessee did not purchase or acquire any rights under the agreement and in fact the agreement between the assessee and Two would cease to e xist once JX NOE cancels the license of intellectual prope rty in terms of Eneo s as in that case "Two" would no t be able to JX Nippon Two Lubricants India Pvt. Ltd.

15. After considering all the facts of the case, the Assessing Officer held as under:

"The assessee grossly failed to provide the any cogent and reliable mate rial on the basis of which, the claim of depreciation was allowed to it. The agreement when read into contextual manner then it leads to only one irretrievable conclusion that the whole exercise was carried out by the assessee, JX NOE and TWO to provide the franchisee to the assessee and create the huge amount of goodwill in the books of the assessee on which the depreciation could be claim whereby income of the concerned assessment year or thereafte r would get reduce by virtue of such goodwill As I have already been discussed, as supra, that the all the intellectual property would be vested with the JX NOE and TWO is in a counterpart in India has been used to sale the "ENEO" branded product. TWO did not have any rights or if any which are only based on the IPR of the JX NOE therefore co uld not said to be ceded the rights which it did not hold. There fo re, it is JX Nippon Two Lubricants India Pvt. Ltd.