lakhs on account of change in the method of accounting of franchisee fees
and undisclosed franchisee fees for the Financial Year („FY‟) during which ... statement, the AO
surmised that the number of outlets for which franchisee fee was received
assessee
in order to impress upon the A.O that the franchisee fees was rightly
claimed as a revenue expenditure, submitted as under ... aforesaid conviction relied on Clause 7
of the Franchisee Agreement, which provided as regards the franchisee
fee as under:-
"7.1. As consideration
allowed on total
franchisee cost in the first year itself on accrual basis and not on the
franchisee fees paid during the relevant year ... that the assessee has claimed Rs.
58,44,60,480/- as franchisee fee in its P & L Account. He further noted that
National Highways (Fees for the use of National Highway Section and Permanent Bridge-Public Funded Projects) Rules, 1997
9. Fee collection through franchisee ... charge of fee collection who shall be responsible to ensure that fees arecollected at not more than the notified rates and the fee collection
operate the franchisee centre
with immediate effect with no obligation to compensate the
Franchisee in any manner or to seek the Franchisee‟s
concurrence ... before making such exit.
(ii) Discharge the full consideration of the franchisee
fees as agreed and make all balance payments to the
company
seeking exemption, on the grounds that, inter alia, the franchisee fee
received by it from the satellite schools in lieu of its name, logo ... matters Page 7 of 31
each such case as a "franchisee fee" was exempt under section
This deposit will not bear any interest.
b) Franchisee agrees to pay to VITAN Franchisee fee as under:
Franchisee fees payable to Vitan (Franchisor) will ... commence from the calender month when Franchisee will reach a sale of Rs.900000/-, Franchisee fee will be
1. 1% on total sale
reason whatsoever."
2. The agreement however, envisaged that such franchisee
would pay franchisee fees of Rs. 8 lacs plus tax which
under no circumstances ... franchisee. It is clarified that the Master Franchisee
shall not, under any circumstances be liable to refund to
the SubFranchisee the Franchisee fee either
this respect.
4.5 To understand the manner of computation of the
franchisee fees, as per the Schedule C to the agreement we
reproduce ... invoices issued, for charging franchisee
fees from the appellant. This invoice is also depicted in the
ledger account of Franchisee Fees maintained by the appellant
McDonald‟s
USA
7. According to the Department, the franchisees, apart
from remitting franchisee fees and royalty amount were also
required to contribute ... determined
under the 2006 Rules. Thus, since the franchisee, apart from
remitting franchisee fees and royalty amount, had also to
contribute at least
