KREEM FOODS PRIVATE LIMITED Vs. STATE OF KERALA

JUDGEMENT

(1.) The assessee is engaged in the manufacture and sale of ice-creams and is the trade mark holder of "SKEI".

(2.) During the course of its business, the assessee-company has entered into agreements with certain other units and appointed them as franchisees to manufacture and effect sale of ice-creams with the brand name "SKEI" for fixed amounts of royalty, at the rate of two per cent on the sales turnover of such units.

(3.) In the annual returns filed, the assessee had claimed exemption for royalty amounts included in the total turnover. The assessing authority at the first instance had granted exemption in respect of the royalty income from assessment to tax.