CESTAT Rules Service Tax Not Payable on Royalty for Use of Group Companies’ Logo

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that service tax is not payable on royalties received for the use of the copyrighted ‘TTK’ logo by group companies.

The tribunal observed that licensing the logo within the corporate group does not amount to a taxable service.

The ruling clarifies that intra-group transactions involving intellectual property rights may be exempt from service tax, provided there is no commercial supply outside the group.

This decision provides guidance for companies managing royalties on copyrighted logos. 

[T.T. Krishnamachari & Co. v. CESTAT]