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30. Next, art. 2 was referred to. The said article is titled as "grant of rights and sub-licence". It was contended that the title itself clinches the issue as the sub-licensor is granting not only the right but also sub-licence to use the process, technical know-how, product and basic process engineering. It should, therefore, be our endeavour to see what right the assessee got and in what respect it got sub-licence.

31. T. P. Mukerjee's Law Lexicon Vol. 2, (1982 Edn.) describes the term "licence" as follows :

32. P. Ramanatha Iyer's Law Lexicon (1997 Edn.) describes the term "Licence" as follows :

"An authority to do something which would otherwise be inoperative, wrongful or illegal, a formal permission from a constituted authority to do something. In the popular as also in the legal sense a licence is a permission to do something which, without the licence would not be allowable. In the secondary sense it denotes a certificate or document which embodies the permission in question."

The above paras, no doubt, explain the meaning of the term licence, whereas the case before us is that of sub-licence. Nonetheless, for all practical purpose, the same meaning would be applicable to the case of sub-licences also as they create rights with the same character.

3.2. The learned A.M. further noted that the main thrust of the learned counsel was that it was not merely the right to use process that the assessee acquired but there was something more than that and according to him a bundle of rights had been acquired by the assessee. He considering the meaning of the term "Licence" as given in T.P. Mukerjee's Law Lexicon Vol. 2 (1982 Ed.) and P. Ramanatha Iyer's Law Lexicon (1997 Edn.) and referring to art. 2 of the contract agreement observed that the assessee acquired only a right to use the know-how by virtue of a sub-licence granted under the contract between the assessee and the Italian company and nothing more than that was acquired. The assessee has not acquired the ownership of the know-how as the preamble of the contract makes it clear that the same is owned by INCA International S.P.A. Italy and the sub-licensor has only the right to sub-licence technical know-how. The assessee has not acquired similar rights under the contract.

4.1. He further submitted that as per Law Lexicon the word "Grant" is described :

"Grant. - An operative word of conveyance, particularly appropriate to deeds of grant, properly so called, but used in other conveyances also, such as deeds of bargain and sale, and leases.

1. The action of granting or bestowing; an authoritative bestowal or conferring of a right, a gift or assignment of money, etc., out of a fund (s. 13, Industrial Development Bank of India Act); 2. the thing granted or bestowed; 3. to bestow by a formal Act [s. 24A(a) Companies (Profits) Surtax Act and s. 42, Prov. Plantations Labour Act); 4. to accede to s. 432(2), CrPC].