Commissioner Of Income Tax, Circle-I, Virudhunagar v. M/S.madras Cements Limited

In the High Court of Judicature at Madras Dated : 28.08.2019 The Honourable Mr.Justice T.S.SIVAGNANAMandThe Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.426 of 2018 Commissioner of Income Tax,Circle-I, Virudhunagar. ...Appellant/AppellantVs M/s.Madras Cements Limited,C/o.Jagadisan & Co.Chartered Accountants,No.245, TTK Road, Residency Apartments,Alwarpet, Chennai - 600 018.PAN: ...Respondent/Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 07.04.2017 made in ITA.No.1111/MDS/2001 on thefile of the Income Tax Appellate Tribunal, Chennai 'D' Bench forthe assessment year 1997-98 against the order of theCommissioner of Income Tax (Appeals) Madurai dated 25.04.2001made in Appeal No. 55/2000-2001 against the Joint Commissionerof Income Tax Special Range I, Madurai dated 24.03.2000 made inP.A. No. 47-016-CV.4019 Assessment year 1997-1998. For Appellant: Mr.M.Swaminathan, SSC and Ms.V.Pushpa, SC For Respondent: Mr.P.J.Rishikesh We have heard Mr.M.Swaminathan, learned Senior StandingCounsel, and Ms.V.Pushpa, learned Standing Counsel appearing forthe appellant/revenue and Mr.P.J.Rishikesh, learned counselappearing for the respondent/assessee. 2.This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated07.04.2017 made in ITA.No.1111/MDS/2001 on the file of theIncome Tax Appellate Tribunal, Chennai 'D' Bench for theassessment year 1997-98. https://hcservices.ecourts.gov.in/hcservices/ 3.The appeal was admitted on 21.06.2019 on the followingsubstantial questions of law :“Whether the Tribunal was right in holding thatthe assessee is entitled to 100% depreciation on Flyash handling system when the same was only a storagesystem and it was also categorized as Plan andMachinery? 2. Whether the Tribunal was right in holdingthat the cost of construction incurred for Vallalarcauseway as revenue expenditure when the above saidexpenditure was made to obtain enduring benefit forthe asessee company? 3. Whether the Tribunal was right in holdingthat the replacement of Rotor represents revenueexpenditure, without noting the Rotor itselfconstitutes an independent machine with independentfunction and replacement of the same will amounts tocapital expenditure?” 4.The learned Senior Standing Counsel for the appellantsubmits that the above appeal is not pursued by the Revenue onaccount of the low tax effect in terms of Circular No.17/2019dated 08.8.2019 issued by the Central Board of Direct Taxes. Bythe said Circular, the monetary limit for filing or pursuing anappeal before the High Court has been increased to Rs.1 Crore.It is further submitted that the tax effect in this case is lessthan the threshold limit. 5.In the light of the said submissions, the above tax caseappeal is dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the eventthe tax effect is above the threshold limit fixed in the saidcircular, liberty is granted to the Revenue to make a mention tothis Court to restore the appeal to be heard and decided onmerits. No costs. s/d- Assistant Registrar(CS V) True Copy Sub-Assistant Registrar cse To 1.The Income Tax Appellate Tribunal, Chennai 'D' Bench. 2.The Commissioner of Income Tax (Appeals) Madurai 3.The Joint Commissioner of Income TaxSpecial Range I, MaduraiSpecial Range I, Madurai +1 CC to Mr.M.Swaminathan, advocate sr 74847 +1 CC to Mr.P.J.Rishikesh, Advocate sr 74468 TCA.No.426 of 2018 VGII(CO)SP(05/11/2019)