Commissioner Of Income Tax, Madurai v. M/S Janakiram Mills Ltd., Tenkasi Road, Rajapalayam

IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated:-29-04-2005 Coram:The Hon'ble Mr. Justice P. SATHASIVAMandThe Hon'ble Mr. Justice S.K. KRISHNAN Tax Case (Ref) Nos. 144, 408, 409/1999, 70/2000 and 30/2001 andT.C.Appeal Nos. 46/2000, 231/2001, 48, 53, 54, 60, 61, 62 to 64, 94, 95,96, 124, 138, 156, 214, 215/2003, 9, 46, 53, 82, 103, 123 to 125, 195,202, 212, 224, 250, 262, 277, 285, 312, 317, 327, 342, 363, 364, 377, 435,436, 437, 443, 486, 373, 438, 530, 727, 728, 729, 743, 745, 746, 750, 769,951, 952, 1076, 1081, 1101, 1118, 1120, and 1113/2004 andT.C.M.P.Nos. 93, 251/2003, 457, 468/2004 etc. Commissioner of Income Tax,Madurai ..Applicant in TC Ref Nos.144,408,409 of 1999 and 70/2000 and 30/2001, 54/2003 96/2003,124/03 138/03,156/03,214 & 215/03,9,46,53,103,195, 202,212,224,250,277,285, 317,327,342,363,& 364 377,435,436,437. 443,486,373,438, 530,727,728,729,743 745,746,750,769,951 1076,1101,1120,and 1113/04 -Vs- M/S Janakiram Mills Ltd.,Tenkasi Road,Rajapalayam ..Respondent in TC(Ref) Nos.144,408 and 409 of 1999 & TC (A) 231/01 M/S Ayyappan Textiles Ltd.,Thirunagar,Madurai. Dt. ..Respondent in TC (Ref) No.70/2000 & TC(A) Nos.377 & 1120/04..Respondent in TC(Ref) No.30/01 & TC (A) 54/03..Applicant in T.C. Appeal No.46 of 2000..do in TC (A) No. 231/01..do in TC (A) No. 53/03..do in TC(A)Nos.60 & 61 of 2003..do in TC(A) Nos.62 to 64 of 2003..do in TC(A) Nos.48/03 94/03,95/03,123 to 125 of 2004, 1118/04..do in TC(A) No. 82/04..do in TC(A) 262/04 Nagammal Mills Ltd.,Vatturnindam,Nagercoil The Commissioner of Income TaxCoimbatore (Spl.Range)The Deputy Commissioner of Income Tax,(Spl.Range)Madurai.The Commissioner of Income Tax,TrichyThe Commissioner of Income TaxTirupurPrecot Mills Limited,“SUPREM” P.B.3888,Race Course,Coimbatore-641 018 Commissioner of Income Tax,Coimbatore The Joint Commssioner of Income Tax,Spl.Range II,Coimbatore. The Commissioner of Income Tax III,Coimbatore. https://hcservices.ecourts.gov.in/hcservices/ The Commissioner of Income-Tax(I)Chennai. ..do in TC(A) 312/04 The Commissioner of Income Tax III,Chennai-do- in TC(A) No.952/04 The Deputy Commissioner of Income Tax,Special Range I,Madurai. ..do in TC(A) No.1081/04 The Sri Venkatesa Mills Ltd.,Palani Road,Venkatesa Mill Post,Udumalpet M/S The Suguna Mills Ltd.,Coimbatore ..Respondent in TC Appeal No. 46 of 2000..Respondent in TC(A) 48/2003 Aravind Spinners (P) Ltd.,Tirunelveli ..Respondent in TC(A)No.53/2003 Sri Shanmugavel Mills P. Ltd.,TirupurThe Joint Commissioner of Income TaxSpecial Range-II,Coimbatore ..Respondent in TC(A) Nos.60 & 61 of 2003..Respondent in TC(A)'s 62 to 64 of 2003 M/S Prachidhi Spinners (P) Ltd.,Udumalpet Taluk ..Respondent in TC(A) 94/03..Respondent in TC (A) No. 95/03 Hindustan Textiles,Coimbatore. M/S The Ramaraju Surgical Cotton,Mills Limited,Rajapalayam ..Respondent in TC(A) No.96/03, 250 and 342 of 2004 M/S L.S.Mills Ltd,Theni. ..Respondent in TC(A) No.124/03..Respondent in TC (A) No.138/03 486/04 & 769/04 M/S Sri Ranilakshmi Gng.Spg,&Wvg Mills (P) Ltd.,Tirunagar,Madurai. M/S Vishnu Shankar Mills Ltd.,Rajapalayam ..Respondent in TC (A) 156/03 & 1113/04..Respondent in TC(Appeal) Nos.214/03& 215/03..Respondent in TC(A) 9/04, and 212/04 TC(A) 46/04..Respondent in TC (A) 53/04 & 277/04..Respondent in TC(A)82/04 M/S Arcot Textile Mills Ltd.,Madurai..Respondent in TC(Appeal) Nos.214/03& 215/03M/S Swamiji Mills Ltd.,Sivakasi..Respondent in TC(A) 9/04, and 212/04Sree Ayyanar Spg.Wng Mills Ltd., ..Respondent in Mallangiran TC(A) 46/04M/S Saravana Spinning Mills Pvt. Ltd.,Dindigul..Respondent in M/S Gomati Spinning Mills Ltd.,Tirupur M/S Loyal Textiles Millskovilpatti ..Respondent in TC(A) 103/04..Respondent in TC(A) 123 to 125 of 2004 M/S Sivaraj Spinning Mills (P) Ltd.,Tirupur The Vijayakumar Mills Ltd.,Palani ..Respondent TC(A) 195/04 https://hcservices.ecourts.gov.in/hcservices/ M/S Rajapalayam Mills Ltd.,Madurai..Respondent in TC(A) No.202/04 M/S Thiagrajar Mills Ltd.,Madurai. M/S Arcot Textile Mills Ltd.,Madurai..Respondent in TC(Appeal) Nos.214/03& 215/03M/S Swamiji Mills Ltd.,Sivakasi..Respondent in TC(A) 9/04, and 212/04Sree Ayyanar Spg.Wng Mills Ltd., ..Respondent in Mallangiran TC(A) 46/04M/S Saravana Spinning Mills Pvt. Ltd.,Dindigul..Respondent in M/S Gomati Spinning Mills Ltd.,Tirupur M/S Loyal Textiles Millskovilpatti ..Respondent in TC(A) 103/04..Respondent in TC(A) 123 to 125 of 2004 M/S Sivaraj Spinning Mills (P) Ltd.,Tirupur The Vijayakumar Mills Ltd.,Palani ..Respondent TC(A) 195/04 https://hcservices.ecourts.gov.in/hcservices/ M/S Rajapalayam Mills Ltd.,Madurai..Respondent in TC(A) No.202/04 M/S Thiagrajar Mills Ltd.,Madurai. Madurai...Respondent in TC(A) No.224/04M/S Venkatalakshmi Textile Pvt. Ltd.,Tirupur..Respondent in TC(A) No.262/04M/s.Varadhalakshmi Mills Ltd.,Thirunagar, Madurai.. Respondent in TC (A) 285/04M/s.Indra Cotten Mills Ltd.,Chennai..Respondent in TC (A) 312/04M/s.Sree Nithyakalyani Mills Ltd.,Thiruvadanai..Respondent in TC (A) 317/04M/s.Sithalakshmi Mills Ltd.,Madurai..Respondent in TC(A) 327/04 & 1076/2004 M/s.Gitanjali Mills Ltd.,Rajapalayam..Respondent in TC (A) 363/04 and 364/04 Sree Vadivambigai Textiles Ltd.,Sivagangai..Respondent in TC (A)435/04 Raji Spinning Mills (P) Ltd.,Rajapalayam...Respondent in T (C) (A) 436 & 437 of 2004 M/s.Arasan Textile Mills (P) Ltd.,Tuticorin -I...Respondent in TC (A) No.443/04 & TC (A) 750/04 M/s. Sri Padmavathi Cotton MillsSrivilliputhur Road,Rajapalayam...Respondent in TC (A) 373/04M/s. Sivakami Mills Ltd.,Thenur, Samayanallur-625 402..Respondent in TC (A) 438/04 https://hcservices.ecourts.gov.in/hcservices/ M/s.Shri Sivakami Mills Ltd.,Madurai..Respondent in TC (A) 530/04 M/s. Valli Cotton Traders Ltd.,N.VenkateswarapuramSattur Taluk..Respondent in TC (A) 727/04 M/s/Bojraj Textile Mills Ltd.,Madurai-6..Respondent in TC (A) 728, 729/04& 951/04 ,1081/04 M/s. Thirumalai Mills112,East Car StreetTirunelveli..Respondent in TC (A) No.743/04 The Tuticorin Spinning Mills Ltd.,Tuticorin..Respondent in TC (A) 745 & 746/04 M/s. Sirius Shipping Company Ltd.,Chennai-6...Respondent in TC(A) 952/04.M/s. Khader Spiners Ltd.,M.M.Kovilur Post, Dindugul..Respondent in TC (A) 1101/04 M/s.Sri Karunambigai Mills Ltd.,Coimbatore..Respondent in TC (A) 1118/04 The above Tax Cases filed under Section 256 (1) of Income Tax Act, 1961for Reference; and Tax Appeal Cases filed under Section 260-A of IncomeTax Act, 1961 against orders of Income Tax Appellate Tribunal, Madras asstated therein. The above Tax Cases filed U/s. 256 (1) of I.T. Act for reference to thiscourt by the Income Tax Appellate Tribunal B,C,A and C Bench Madras,respectively in1.R.A.No.62/Mds./98 in ITA.No.3892/Mds/98 in ITA.NO.3892/Mds.89 for theAssessment Year 1986-87 on the file and refer to the decision of thisCourt the following questions of law: viz. (i) Whether on the facts and in the circumstances of the case, theTribunal is right in law in holding that the expenditure incurred by theassessee during the accounting year on the cost of Carding System(Rs.31,22,679/-) was amount paid on current repairs and allowable undersection 31 of the Income Tax Act?" (ii) Whether on the facts and circumstances of the case, the AppellateTribunal was right in law in directing allowance of the entire amount ofRs.31,22,679/- as Revenue expenditure?" (in TC.Ref.No.144/99) against the order in I.T.Appeal No.144/89-90 dated 20.6.89 on the file ofthe Commissioner of Income Tax (Appeals-I) Madurai Range, Madurai againstthe order in PA.No.47-018 - CV.3991/86-87 dated 28.3.89 on the file of theDeputy Commissioner of Special Range-II, Madurai, (in TC.(Ref.)No.144/99) 2.R.A.Nos.551 and 552/Mds/93 in ITA.Nos.2775 and 2676 (Mds.)/92 for theAssessment year 1989-90 and 1990/91 on the file and refer to the decisionof this court the following questions of law:viz. (ii) Whether on the facts and circumstances of the case, the AppellateTribunal was right in law in directing allowance of the entire amount ofRs.31,22,679/- as Revenue expenditure?" (in TC.Ref.No.144/99) against the order in I.T.Appeal No.144/89-90 dated 20.6.89 on the file ofthe Commissioner of Income Tax (Appeals-I) Madurai Range, Madurai againstthe order in PA.No.47-018 - CV.3991/86-87 dated 28.3.89 on the file of theDeputy Commissioner of Special Range-II, Madurai, (in TC.(Ref.)No.144/99) 2.R.A.Nos.551 and 552/Mds/93 in ITA.Nos.2775 and 2676 (Mds.)/92 for theAssessment year 1989-90 and 1990/91 on the file and refer to the decisionof this court the following questions of law:viz. (i) Whether the finding of the Tribunal, that the ring frame, N.M.M.Doubling frames and Double swift reeling Machine purchased by the assesseeat cost of Rs.20,64,868/- were not new machinary but were parts ofmachinery is valid and is not perverse? (ii) Whether on the facts and in the circumstances of the case, theAppellate Tribunal, was right in directing in allowing of the entireamount of Rs.20,64,868/- as revenue expenditure?" (in TC.Ref.No.408 and409 of 1999) against the order in I.T.Appeal No.120/1992-93 dated28.8.1992 on the file of the Commissioner of Income Tax Appeal-I Madurai against the order in PA.No.47-016-CV-3991/89-90 dated 17.3.1992 on thefile of the Deputy Commissioner of Income Tax (Special Range) II, Madurai(in TC.(Ref) Nos.408 and 409 of 1999). 3.R.A.No.61/Mds/98 in ITA.No.4651/Mds./89 for the Assessment Year 1986-87 on the file and refer to the decision of this court the followingquestions of law:viz. (i) Whether on the facts and in the circumstances of the case the Tribunalis right in law in holding that the expenditure incurred by the asesseeduring the accounting year on the cost of Carding Machines and SimplexMachines (Rs.11,76,576/-) was amount paid on current repairs and allowableunder Section 31 of the Income Tax Act?. (ii) Whether on the facts and in the circumstances of the case theAppellate Tribunal was right in law in directing Allowance of the entireof Rs.11,76,576/- was revenue expenditure)" (in TC.(Ref) No.70 of 2000) against the order in IT.Appeal No.72/89-90 dated 29.9.1989 on the file ofthe Commissioner of Income Tax (Appeal) II, Madurai against the order inPA.No.47-016-CV-3948/86-87 dated 30.8.1989 on the file of the AssistantCommissioner of Income Tax, Company Circle, Madurai (in TC.(Ref)No.70/2000) 4.R.A.No.9/Mds/98 in ITA.No.2774/Mds/98 for the Assessment Year 1990-91on the file and refer to the decision of this court the followingquestions of law; viz. (i) Whether on the facts and in the circumstances of the case the Tribunalis right in law in holding that the expenditure incurred by the assesseeduring the accounting year under cost of Replacement of Machinariesamounting to Rs.26,20,650/- was amount paid on account of currect repairsand allowable under section 31 of the Income Tax Act?" (ii) Whether on the facts and in the circumstances of the case, theTribunal was right in law in directing allowance of the entire amount ofRs.26,20,650/- a revenue expenditure)" (in TC.Ref.No.30 of 2001) againstthe order in ITA.No.237/93-94 dated 30.8.1993 on the file of theCommissioner of Income Tax (Appeals)I, Madurai against the order inPAN.No.47-016-CT-4664/1990-91 dated 19.3.1993 on the file of the DeputyCommissioner of Income Tax Special Range, Madurai (in TC.(Ref) No.30/2001).TC.(Appeals) under section 260(A) of I.T.Act 1961 preferred against (1) Income Tax Appellate Tribunal Madras 'B' Bench dated 14.6.1999 andmade in ITA.No.1709/Mds./98 for the assessment year 1995-96 against theorder in I.T.Appeal No.1069-C/97-98 dated 28.8.1998 on the file of theCommissioner of Income Tax Appeals, Coimbatore against order in PA.No. CV-1108 dated 17.2.1998 on the file of the Deputy Commissioner of Income TaxSpecial Range-I, Coimbatore. (in TC (A) No.46/2000). (1) Income Tax Appellate Tribunal Madras 'B' Bench dated 14.6.1999 andmade in ITA.No.1709/Mds./98 for the assessment year 1995-96 against theorder in I.T.Appeal No.1069-C/97-98 dated 28.8.1998 on the file of theCommissioner of Income Tax Appeals, Coimbatore against order in PA.No. CV-1108 dated 17.2.1998 on the file of the Deputy Commissioner of Income TaxSpecial Range-I, Coimbatore. (in TC (A) No.46/2000). (2) ITAT Madras "C" Bench dated 24.3.99 made in ITAT.No.1716/Mds./1990 forthe Assessment Year 1987-88 against the order in ITA.No.441/1989-90 dated28.2.1990 on the file of the Commissioner of Income Tax Appeals II,Madurai against order in PA.No.47-016-CV-3991/87-88 dated 29.12.1989 onthe file of the Deputy Commissioner of Income Tax, Special Range I,Madurai (in TC.(A) No.231/2001) (3) ITAT Madras 'C' Bench dated 3.1.2003 made in ITA.No.1457/Mds./2002 forthe Assessment Year 1998-99 against the order in ITA.No.135/2000-01 dated23.7.2002 on the file of the Commissioner of Income Tax Appeals-I,Coimbatore against the order in PAN/GIR No.C2-1105/SR-II/CBE., dated28.2.2001 on the file of the Joint Commissioner of Income Tax SpecialRange-II, Coimbatore (in TC.(A) No.48/2003) (4) ITAT, Madras 'B' Bench dated 13.1.2003 made in ITA.No.1860/Mds/94 forthe Assessment Year 1991-92 against the order in ITA.No.47/94-95 dated19.5.1994 on the file of the Commissioner of Income Tax Appeals-I, Maduraiagainst the order in PA.No.47-055-CT-7519/DC/SR-II/Mdu. dated 18.2.1994 onthe file of the Deputy Commissioner of Income Tax Special Range, II,Madurai (in TC(A).No.53/03). 5. ITAT, Madras 'B' Bench dated 26.9.2002 made in ITA.No.2845/mds/93 forthe Assesment year 1990-91, against the order in ITA.No.237/93-94 dated 30.8.93 on the file of the Commissioner of Income Tax(Appeals) I, Maduraiagainst the order in PAN.No.47-016-CT-4664/90-91/IT dated 19.3.93 on thefile of the Deputy Commissioner of Income Tax, Special Range, Madurai (inTC(A) No.54/03). 6. ITAT, Madras 'C' Bench dated 21.1.2003 in ITA.Nos.1430, 1431 of 2002for the Assessment years 1993-94 and 1994-95 respectively against theorder in ITA.No.570 & 571 - C/2001 - 2002 dated 30.6.2002 on the file ofthe Commissioner of Income Tax (Appeals) II, Coimbatore against the orderin PANGIR.Nos.S-3-2001-02/ Tiruppur and S-3/Circle-1/Tiruppur dated11.2.2002 on the file of the Assistant Commissioner of Income Tax CircleI, Tiruppur (in TC(A) Nos.60 & 61 of 2003) 7. ITAT, Bench 'B" Chennai dated 27.3.2003 made in ITA Nos.1382/Mds/1999,1950/Mds/2000 and 1965/Mds/2000 respectively for the Assessment years1995-96 to 1997-98 respectively against the order in IT Appeal Nos.244-C/98-99, dated 30.7.99, 121-C/99-2000 dated 13/10/00 and 63-C/2000-01dated 20.10.2000 respectively on the file of the Commissioner of IncomeTax Appeals Coimbatore against the order in PAN.No.C4-8833 dated 27.3.98;Cy-8833/SR-II/CBE dated 30.3.99 and Cy-8833/SR-II/97-98/CBE dated29.3.2000 respectively on the file of the Deputy Commissioner of IncomeTax, Special Range II, Coimbatore and Joint Commissioner of Income TaxSpecial Range II, Coimbatore respectively. (in TC(A) Nos.62 to 64 of 2003) 8. ITAT, Madras 'A" Bench dated 28.2.2003 in ITA.No.1426/Mds/2002 for theassessment year 1998-99 against the order in IT Appeal No.20-C-2002/2003dated 30.6.2002 on the file of the Commissioner of Income Tax Appeals II,Coimbatore against the order in PAN/GIR.No.P-3/1998-99 dated 30.3.2002 onthe file of the Deputy Commissioner of Income Tax, Salary Circle I,Coimbatore (in TC(A) 94 of 2003) 9.ITAT, Madras 'A" Bench dated 18.3.2003 in ITA.No.675/Mds/1999 for theAssessment year 1994-95 against the order in IT Appeal Nos.705, 793,792/2001-2002 dated 28.1.2002 on the file of the Commissioner of IncomeTax Appeals I, Coimbatore against the order in PA.No.GIR.No.F2-7763/SIC-2/CBE dated 22.3.01 on the file of the Deputy Commissioner of Income Tax,Special Investigation Circle II, Coimbatore (in TC(A).No. 95 of 2003) 9.ITAT, Madras 'A" Bench dated 18.3.2003 in ITA.No.675/Mds/1999 for theAssessment year 1994-95 against the order in IT Appeal Nos.705, 793,792/2001-2002 dated 28.1.2002 on the file of the Commissioner of IncomeTax Appeals I, Coimbatore against the order in PA.No.GIR.No.F2-7763/SIC-2/CBE dated 22.3.01 on the file of the Deputy Commissioner of Income Tax,Special Investigation Circle II, Coimbatore (in TC(A).No. 95 of 2003) 10. ITAT, Madras 'C" Bench dated 10.2.2003 in ITA.No.755/Mds/1994 forthe Assessment years 1990-91 against the order in IT Appeal No.678/92-93dated 15.2.94 on the file of the Commissioner of Income Tax Appeal I,Madurai against the order in PAN.No.47-016-Fy-4052/SR-2/mdu dated Nil onthe file of the Deputy Commissioner of Income Tax, Speical Range II,Madurai (in TC(A) Nos.96 of 2003) 11.ITAT, Madras 'C" Bench dated 4.3.2003 in ITA.No.543/Mds/95 for theAssessment year 1991-92 against the order in IT Appeal No.852/93-94 dated30.12.94 on the file of the Commissioner of Income Tax (Appeals) Maduraiagainst the order in PANo.49-003-CZ -8024/DC/SR-II/Mdu dated 15.2.94 on the file of the Deputy Commissioner of Income Tax, Special Range II,Madurai (in TC(A) 124 of 2003) 12.ITAT, Bench 'B" Madras dated 24.3.2003 in ITA.No.175/Mds/1995 for theAssessment year 1991-92 against the order in IT Appeal No.197/94-95 dated28.10.94 on the file of the Commissioner of Income Tax (Appeals) I,Madurai against the order in PA.No.47-021-CY-1092 dated 31.3.1994 on thefile of the Deputy Commissioner of Income Tax, Special Range(Cent) Madurai(in TC(A)No. 138/03) 13.ITAT, Madras 'B" Bench dated 28.2.2003 made in ITA.No.2105/Mds/1994 forthe Assessment year 1991-92 against the order in IT Appeal No.65/1994-95dated 28.7.1994 on the file of the Commissioner of Income Tax Appeals IMadurai against the order in PA.No.49-000-60-5213/DC.SR/II/Madurai dated28.3.94 on the file of the Deputy Commissioner of Income Tax, SpecialRange Madurai (in TC(A) 156 of 2003) 14.ITAT, Madras 'C" Bench dated 28.5.2003 in ITA.No.1259 and 1260 /Mds/1994 respectively for the Assessment years 1991-92 and 1992-93respectively against the order in IT Appeal Nos.676 and 677/93-94 dated16.2.94 on the file of the Commissioner of Income Tax Appeals I, Maduraiagainst the order in PA-47-016-CV-3949/91-92/IT dated 20.12.93 on the fileof the Deputy Commissioner of Income Tax, Special Range I, Madurai (in TC(A) 214 & 215 of 2003) 15. ITAT Bench 'B' Chennai dated 24.7.2003 made in ITA.No.1097/Mds/96Assessment year 93-94 against the order in ITA.No.354/95-96 dated 20.2.96on the file of the Commissioner of Income Tax (Appeals I) madurai againstthe order in PAN/GIR/No.47-016-CT-4083 dated 7.4.95 on the file of theDeputy Commissioner of Income Tax Special Range I, Madurai 2. (TC.No.(A)9of 2004). 16.ITAT, Madras 'B" Bench dated 22.1.2003 made in ITA.No.1264/Mds/1994,Assessment year 91-92 against the order in ITA No.580/93-94 dated 8.2.94on the file of the Commissioner of Income Tax (Appeals I), Madurai againstthe order in PA.No.47-016-CV-3947/91-92 dated 22.9.93 on the file of theDeputy Commissioner of Income Tax, Special Range I, Madurai (TC(A) 46 of2004) 17.ITAT, Madras 'B" Bench dated 31.12.02 made in ITA.No.2596/Mds/1994Assessment year 1992-93 against the order in ITA No.357/94-95 dated8.9.1994 on the file of the Commissioner of Income Tax (Appeals I),Madurai against the order in PA.No.49-003-CY-0220 Order dated 4.4.94 onthe file of the Deputy Commissioner of Income Tax, Special Range II,Madurai (TC(A) 53 of 2004) 18. ITAT Madras 'B' Bench dated 22.5.2001 made in ITA No.469/Mds/2000Assessment year 97-98 against the order in ITA No. 387-C/99-2000 orderdated 17.2.2000 on the file of commissioner of Income Tax (Appeals) https://hcservices.ecourts.gov.in/hcservices/ 17.ITAT, Madras 'B" Bench dated 31.12.02 made in ITA.No.2596/Mds/1994Assessment year 1992-93 against the order in ITA No.357/94-95 dated8.9.1994 on the file of the Commissioner of Income Tax (Appeals I),Madurai against the order in PA.No.49-003-CY-0220 Order dated 4.4.94 onthe file of the Deputy Commissioner of Income Tax, Special Range II,Madurai (TC(A) 53 of 2004) 18. ITAT Madras 'B' Bench dated 22.5.2001 made in ITA No.469/Mds/2000Assessment year 97-98 against the order in ITA No. 387-C/99-2000 orderdated 17.2.2000 on the file of commissioner of Income Tax (Appeals) https://hcservices.ecourts.gov.in/hcservices/ Coimbatore, against the order in PAN No. G4/SR/II/CBE dated 11.10.99 onthe file of Joint Commissioner of Income Tax Special Range – II,Coimbatore. (TC (A) No. 82 /2004) 19. ITAT Madras 'B' Bench dated 3.7.2003 made in ITA No.290/Mds/96Assessment year 92-93 against the order in ITA No. 124/95-96 dated9.11.1995 on the file of commissioner of Income Tax (Appeals I) Maduraiagainst the order in PAN No. 47-016-CQ-4644 DC.S.R.II/TDU dated 24.3.95 onthe file of Deputy Commissioner of Income Tax Special Range – II, Madurai.(TC (A) No. 103 /2004 20. ITAT Madras 'B' Bench dated 28.2.2003 made in ITA Nos.1427-1429/MDd/2002 Assessment year 93-94 to 1995-96 on the file against theorder in ITA Nos.567-C,568-C,569-C/2001-2002 dated 30.6.2002 on the fileof the Commissioner of Income Tax (Appeals) -II Coimbatore against theorder in PAN/GIR No.S-2/Circle-I Tirupur dated 13.2.02 on the file of theAssistant Commissioner of Income Tax Circle – 1 Tirupur. TC (A) No. 123 to125 of 2004 21. ITAT Madras 'C' Bench dated 5.11.2003 ITA No.2147/Mds/95 Assessmentyear 92-93 against the order in ITA No. 153/95-96 dated 31.7.2005 on thefile the Commissioner of Income Tax (Appeals I) Madurai against theorder in PA No. 47-016-CV-4761 dated 6.3.95 on the file of the DeputyCommissioner of Income Tax Special Range – I, Madurai.2 (TC (A) No. 195 of2004) 22. ITAT Madras 'B' Bench dated 26.8.2003 in ITA No.1603/Mds/96 Assessmentyear 91-92 against the order in ITA No. 2697/93-94 dated 9.4.96 on thefile the Commissioner of Income Tax (Appeals ) Madurai against the orderin PA No. 47-016-CZ-4051 dated 27.12.93 on the file of the DeputyCommissioner of Income Tax Special Range – I, Madurai. (TC (A) No. 202 of2004) 23. ITAT 'C' Bench Chennai dated 22.7.2003 in ITA No.1292/Mds/95Assessment year 92-93 against the order in ITA No. 676/94-95 dated28.3.95 on the file of the Commissioner of Income Tax (Appeals I) Maduraiagainst the order in PA No. 47-016-CT-4083 dated 4.10.94 on the file ofthe Deputy Commissioner of Income Tax Special Range – I, Madurai.1(TC (A) No. 212 of 2004) 24. ITAT Madras 'A' Bench dated 17.11.2003 in ITA No.55(Mds)97 Assessmentyear 93-94 against the order in ITA No. 97/96-97 dated 30.10.96 on thefile the Commissioner of Income Tax (Appeals) Madurai against the orderin PAN/GIR No. 47-022-CN 9955 dated 29.3.96 on the file of the DeputyCommissioner of Income Tax Special Range – II, Madurai. (TC (A) No. 224 of2004) 25. ITAT Madras 'A' Bench dated 17.11.2003 in ITA No.49/Mds/97 Assessmentyear 93-94 against the order in ITA No. 39/96-97 dated 30.10.1996 on the file the Commissioner of Income Tax (Appeals I) Madurai against theorder in PAN No. 47-016-CY-4052/DC.SR.II/MDU dated 29.3.96 on the fileof the Deputy Commissioner of Income Tax Special Range – II, Madurai. (TC(A) No. 250 of 2004) 26. ITAT Chennai 'A' Bench dated 8.12.2003 in ITA No.762/Mds/2000Assessment year 95-96 against the order in ITA No. 43-C/98-99 dated21.2.2000 on the file the Commissioner of Income Tax (Appeals) Coimbatoreagainst the order in PAN/GIR No.CZ-1039/SR-II/CBE dated 17.3.98 on thefile of the Deputy Commissioner of Income Tax Special Range – II,Coimbatore (TC (A) No. 262 of 2004) 25. ITAT Madras 'A' Bench dated 17.11.2003 in ITA No.49/Mds/97 Assessmentyear 93-94 against the order in ITA No. 39/96-97 dated 30.10.1996 on the file the Commissioner of Income Tax (Appeals I) Madurai against theorder in PAN No. 47-016-CY-4052/DC.SR.II/MDU dated 29.3.96 on the fileof the Deputy Commissioner of Income Tax Special Range – II, Madurai. (TC(A) No. 250 of 2004) 26. ITAT Chennai 'A' Bench dated 8.12.2003 in ITA No.762/Mds/2000Assessment year 95-96 against the order in ITA No. 43-C/98-99 dated21.2.2000 on the file the Commissioner of Income Tax (Appeals) Coimbatoreagainst the order in PAN/GIR No.CZ-1039/SR-II/CBE dated 17.3.98 on thefile of the Deputy Commissioner of Income Tax Special Range – II,Coimbatore (TC (A) No. 262 of 2004) 27. ITAT Madras 'B' Bench dated 23.10.2003 in ITA No.53/Mds/97 Assessmentyear 93-94 on the file against the order in ITA No. 133/96-97 dated24.10.1996 on the file of the Commissioner of Income Tax Appeals IMadurai against the order in PAN No. CY-0220/DC.SR.II/MDV dated 22.3.96on the file of the Deputy Commissioner of Income Tax Special Range – II,Madurai. (TC (A) No. 277 of 2004) 28. ITAT Madras 'B' Bench dated 27.11.2003 in ITA No.103/Mds/96 Assessmentyear 92-93 against the order in ITA No. 218/95-96 dated 5.10.95 on thefile of the Commissioner of Income Tax (Appeals I) Madurai against theorder in PA No. 47-016-CN-4099 dated 31.3.95 on the file of theAssistant Commissioner of Income Tax Central Circle, Madurai. (TC (A) No.285 of 2004) 29. ITAT Madras 'A' Bench dated 18.9.2003 in ITA No.2701/Mds/95 Assessmentyear 92-93 against the order in ITA No. 209/94-95 dated 25.9.95 on thefile of the Commissioner of Income Tax (Appeals VII) Madras against theorder in GI No. 10-I, dated 30.1.1995 on the file of the DeputyCommissioner of Income Tax Special Range – II, Madras.(TC (A) No. 312 of2004) 30. ITAT Bench 'A' Madras dated 6.11.2003 in ITA No.2590/Mds/96 for theAssessment year 93-94 against the order in ITA No. 61/96-97 dated 30.9.96on the file of the Commissioner of Income Tax (Appeals I) Maduraiagainst the order in PAN/GIR No. 47-016-CY-4738 dated 14.2.95 on the fileof the Deputy Commissioner of Income Tax Special Range – I, Madurai.2 (TC(A) No. 317 of 2004) 31. ITAT Bench 'B' Madras dated 21.10.2003 in ITA No.2699/Mds/94 for theAssessment year 93-94 against the order in ITA No. 95/96-97 dated 7.10.96on the file the Commissioner of Income Tax (Appeals I) Madurai againstthe order in PAN No. 47-016-CQ-4063 dated 26.2.96 on the file of theDeputy Commissioner of Income Tax Special Range – I, Madurai.2(TC (A) No.327 of 2004) 32. ITAT Madras 'A' Bench dated 10.10.2003 ITA No.643/(Mds)/96 Assessmentyear 92-93 against the order in ITA No. 37/95-96 dated 1.12.95 on the file the Commissioner of Income Tax (Appeals I) Madurai against theorder in PA/GIR No. 47-016-CY-4052 dated 31.3.95 on the file of theDeputy Commissioner of Income Tax Special Range – II, Madurai.2(TC (A) No. 342 of 2004) 33. ITAT Madras 'A' Bench dated 13.8.2002 made in ITA Nos.98 & 99/Mds/94Assessment year 91-92 against the order in ITA No. 382/93-94 dated28.10.93 on the file of the Commissioner of Income Tax (Appeals ) Maduraiagainst the order in PA No. 47-016-CX-3984/91-92 dated 9.2.93 on the fileof the Deputy Commissioner of Income Tax Special Range – I, Madurai. 625001.(TC (A) Nos. 363 & 364 of 2004) 34) ITAT Madras "A" Bench dated 19.9.2003 made in ITA. 2673/mds/95Assessment year 1992-93 against the order in ITA No. 160/95-96 dated26/9/95 on the file of the Commissioner of Income-Tax (Appeal I) Madurai,against the order in P.A.No. 47-016-CQ-3948 dated 31/3/95 on the file ofAssistant Commissioner of Income Tax, Central Circle, Madurai (TC (A) No.377 of 2004) ITAT Madras 'B' bench dated 9/10/03 Madurai. 34) ITAT Madras "A" Bench dated 19.9.2003 made in ITA. 2673/mds/95Assessment year 1992-93 against the order in ITA No. 160/95-96 dated26/9/95 on the file of the Commissioner of Income-Tax (Appeal I) Madurai,against the order in P.A.No. 47-016-CQ-3948 dated 31/3/95 on the file ofAssistant Commissioner of Income Tax, Central Circle, Madurai (TC (A) No.377 of 2004) ITAT Madras 'B' bench dated 9/10/03 Madurai. 35)ITA No. 1694/mds/1996-Assessment year 1993-94 against the order in ITANO. 87/96-97 DATED 15/5/96 on the file of the Commissioner of income tax(Appeal) Madurai against the order PAN 47-042-CV-9114/DCSR.II (MDU) dated29/3/96 on the file of Deputy Commissioner of Income TAx Special Range –Madurai. [TC(A) No. 435 of 2004]. ITAT Madras 'B' Bench dated 15/10/03,Madurai. 36)ITAT Madras "B" Bench dated 15.10.2003 made in ITA No. 100 &101/mds/1996- Assessment year 1993-94, 1994-95 against the order ITA No.373 & 3474/95-96, dated 25/10/96 on the file of the Commissioner of IncomeTax (Appeals I) Madurai against the order in P.A.No. /G.I.R.No. 49-003-CN-0246& CN 0246 dated 3/5/95 , 23/5/05 respectively on the file of Deputy ofCommissioner of Income Tax Special Range-I – Madurai(TC(A) No. 436 & 437 of 2004) 37)ITAT, Madras 'C' Bench dated 11/12/03 made in ITA No. 954/mds/96-Assessment year – 1992-93 against the order in ITA No. ITA 70/95-96 dated21/3/96 on the file of the Commissioner of Income Tax (Appeals) madras-3against P.A.N./G.I.R.NO. 47-042-ct-9122 dated Nil on the file of theAssistant Commissioner of Income-tax – Investigation Circle – II –Madurai. (CTC (A) No. 443 of 2004) 38)ITAT, Madras 'B' Bench dated 17/11/03 Made in ITA No. 803 (mds) 96Assessment year 92-93 against the order in ITA 57/95-96 dated 16/1/96 onthe file of the Commissioner of Income Tax (Appeals-I) Madurai against theorder in PA No. 47-021-CY-1992-93 dated 31/1/05 on the file of theAssistant Commissioner of Income Tax, Central Circle madurai [TC(a) No.486/04] 39)ITAT, Madras 'C' Bench dated 18/11/03 made in ITA No. 1435/mds/1996- Assessment year 9192 against the order dated 28/3/96 on the file of theCommissioner of Income Tax (Appeals I) Madurai against the order inPAN/GIR.No. P 446/I(2) VNR dated 29/3/04 on the file of the Income TaxOffice, Ward I(2) virudhu Nagar [TC (A) 373 of 2004] 40) ITAT, Madras 'B' Bench dated 27/11/03 made in ITA No. 193/mds/96-Assessment year 1992-93 against the order in ITA No.167/95-96 dated13/11/95 on the file of the Commissioner of Income Tax (Appeals I),Madurai-1 against the order in P.A.N./GIR No. 47016-CY-4068/DC.SR.II/MDUdated 28/2/95 on the file of the Deputy Commissioner of Income tax SpecialRange II – Madurai.[TC(A) 438 of 2004] 41)ITAT Madras 'C' Bench dated 29.05.2003 made in ITA NO. 2106/mds/94Assessment year 1991-92 against the order in ITA No. 62/94-95 dated 7/7/94on the file of the Commissioner of Income Tax (Appeals)-I Madurai-1against the order in PAN/GIR No. 47-016-CV-4068/DC-SR II. MDU dated 7/3/94on the file of the Deputy Commissioner By Income Tax-Special Range – IIMadurai-2 [TC(A) 530/04] 42)ITAT Madras 'C' Bench dated 24/2/04 made in ITA No. 773/mds/96-Assessment year – 92-93 against the order in ITA NO. 162/95-96 dated25/1/96 on the file of the Commissioner of Income Tax (Appeals) I Maduraiagainst the order in P.A.N/G.I.R.No. 47/042/C2-9946/DC.SR.II/MDU, dated28/2/95 on the file of the Deputy Commissioner of Income Tax – SpecialRange Madurai [TC(A) 727/04] 43)ITAT Madras 'A' Bench dated 10/2/04 made in ITA No. 180/mds/9415/mds/94-Assessmentyear 1990-91 against the order in ITA 175/93-94 dated5/11/93 on the file of the Commisioner of Income Tax (Appeals) I Maduraiagainst the order in PAN/GIR No. 47-016-CN-3956 dated 24/3/93 on the fileof the Assistant Commisioner of Income Tax, Central Circle, Madurai [TC(A)728 & 729/04] 42)ITAT Madras 'C' Bench dated 24/2/04 made in ITA No. 773/mds/96-Assessment year – 92-93 against the order in ITA NO. 162/95-96 dated25/1/96 on the file of the Commissioner of Income Tax (Appeals) I Maduraiagainst the order in P.A.N/G.I.R.No. 47/042/C2-9946/DC.SR.II/MDU, dated28/2/95 on the file of the Deputy Commissioner of Income Tax – SpecialRange Madurai [TC(A) 727/04] 43)ITAT Madras 'A' Bench dated 10/2/04 made in ITA No. 180/mds/9415/mds/94-Assessmentyear 1990-91 against the order in ITA 175/93-94 dated5/11/93 on the file of the Commisioner of Income Tax (Appeals) I Maduraiagainst the order in PAN/GIR No. 47-016-CN-3956 dated 24/3/93 on the fileof the Assistant Commisioner of Income Tax, Central Circle, Madurai [TC(A)728 & 729/04] 44)ITAT Madras 'C' Bench dated 16/1/04 made in ITA No. 335 (mds/97-Assessment year 1994-95 against the order in ITA No. 352/96-97 dated28/11/96 on the file of the Commissioner of Income-Tax (Appeals) I Maduraiagainst the order in PAN No. 47-019-FY-7892 dated 9-9-96 on the file ofthe Deputy Commissioner of Income-Tax Special Range I, Madurai-2 [TC(A)No. 743/04) 45)ITAT Madras 'A' Bench dated 10/2/04 made in ITA No. 955/mds/96 &351/mds/95-Assessment year 92-93, 91-92 against the order in ITA Nos. 18794-95 and 105/95-96 MDU dated 10-11-94 dated 8.3.96 respectively on thefile of the Commissioner of Income-Tax Appeals-I Madurai and theCommissioner of Income Tax (Appeals) Madras-34 against the order inPAN/GIR. No. 47-016-CV-4747 dated 31/3/04 & 31/3/05 respectively on thefile of the Assistant Commissioner of Income Tax – Investigation Circle –II Madurai [TC (A) Nos. 745 & 746/04] 46)ITAT Madras 'B' Bench, dated 12/3/04 made in ITA No. 1385/mds/1998Assessment year 93-94 against the order in ITA No. 604/95-96 dated23/04/98 on the file of the Commissioner of Income-tax (Appeals) VIIMadras against the order in PA No. 47-042 - CT - 9112 order dt. 19/12/95on the file of the Assistant Commissioner of Income - TaxInvestigation Circle - II – Madurai [TC(A) No. 750 of 2004] 47)ITAT madras 'B' Bench dated 17/10/03 ITA No. 2702 (mds)/96 Assessmentyear 93-94 against the order in ITA No. 100/96-97 dated 8.10.96 on thefile of the Commissioner of Income Tax (Appeals I) Madurai against theorder in PAN/GIR No. 47-021-C4-1092 dated 23-02-96 on the file of theDeputy Commissioner of Income Tax, Special Range -I Madurai-2.[TC(A) No. 769/04] 48) ITAT, Madras 'A' Bench dated 20/2/04 made in ITA No. 2669/mds/95Assessment year 92-93 against the order in I.A.No. 35/95-96 dated 27-09-95on the file of the Commissioner of Income Tax (Appeals)I- Madurai againstthe order in PA No. 47-016-CQ – 3956 dated .Nil. On the file of theAssistant Commissioner of Income-Tax Central Circle – Madurai. [TC (A) No.951/04]. 49)ITAT madras 'C' Bench, dated 28/5/04 made in ITA NO. 162/mds/2001Assessment year 1997-98 against the order in ITA No. 329/2000-01 dated11/12/2000 on the file of the Commissioner of Income-Tax (Appeal IV)Chennai against the order in PAN/GIR/No. 1514-S dated 2/3/2000 on thefile of the Deputy Commissioner of Income Tax, Company Circle IV(6)Chennai. 6 (TC(A) No. 952/04) 50)ITAT madras 'A' Bench, dated 25/5/04 made in ITA NO. 1433/mds/1997Assessment year 1994-95 on its file against ITA No. 484/96-97 dated25/3/1997 on the file of the Commissioner of Income-Tax Appeal I Maduraiagainst the order in PAN/GIR/No. 47-016- CQ 4063 order dated 31/12/1996on the file of the Deputy Commissioner of Income Tax,, Special Range – 1,Madurai – 2. (TC(A) No. 1076/04 49)ITAT madras 'C' Bench, dated 28/5/04 made in ITA NO. 162/mds/2001Assessment year 1997-98 against the order in ITA No. 329/2000-01 dated11/12/2000 on the file of the Commissioner of Income-Tax (Appeal IV)Chennai against the order in PAN/GIR/No. 1514-S dated 2/3/2000 on thefile of the Deputy Commissioner of Income Tax, Company Circle IV(6)Chennai. 6 (TC(A) No. 952/04) 50)ITAT madras 'A' Bench, dated 25/5/04 made in ITA NO. 1433/mds/1997Assessment year 1994-95 on its file against ITA No. 484/96-97 dated25/3/1997 on the file of the Commissioner of Income-Tax Appeal I Maduraiagainst the order in PAN/GIR/No. 47-016- CQ 4063 order dated 31/12/1996on the file of the Deputy Commissioner of Income Tax,, Special Range – 1,Madurai – 2. (TC(A) No. 1076/04 51)ITAT Madras 'A' Bench, dated 24/5/01 made in ITA NO. 1548/mds/91Assessment year 1988-89 & ITA No.1595/mds/91 Assessment year 1988 & 89dated 24/5/2001 against ITA No.344/90-91 on the file of the Commissionerof Income-Tax (Appeals) Madras against the order in PAN-47-016-CN-3956dated 23/3/90 on the file of the Assistant Commissioner of Income Tax,Company Circle II 1/C Madurai. (TC(A) No. 1081/04) 52) ITAT, Madras 'C' Bench dated 13.7.2004 made in ITA No.54/mds/1998Assessment Year 93-94 order against the order in ITA No.142/96-97 dt.28.10.96 on the file of the Commissioner of Income-Tax Appeal-I Maduraiagainst the order PA N No. 49-003-CV-0194/DC/SR.II/MDU dated 21.3.96 onthe file of the Deputy Commissioner of Income Tax Special Range-II Madurai-2 (TC (A) No.1101/04) 53) ITAT, Madras 'D' Bench dated 17.5.2002 Made in ITA Nos. 1318/mds/94Assessment Year 91-92 order against the order in ITA No.1390-C/98-99 dt.20.9.99 on the file of the Commissioner of Income Tax (Appeals Coimbatoreagainst the of order PAN /GIR No.CV-1059/SR-II-CBE dated 30.12.98 on thefile of the Joint Commissioner of Income Tax Special Range -II Coimbatore(TC (A) 1118/04) 54) ITAT, Madras 'B' Bench dated 11.7.2001 made in ITA No.2759/MDS/92Assessment Year 89-90 against the order ITA No.167/92-93 order dt. 19.8.92on the file of the commissioner of Income Tax Appeal I, Madurai againstthe order PAN-47-016-CX-3948/1989-90 dt. 27..3.92 on the file of theDeputy Commissioner of Income Tax Special Range I- Madurai -2 (TC (A)1120/04) 55) ITAT, Madras 'C' Bench, dated 28.7.2004 made in ITA.48/Mds/97 -Assessment Year 1993-94 against the order in ITA.43/96-97 dated 23.10.96on the file of the Commissioner of Income Tax (Appeals-1) Madurai againstthe order in PA.No.49-000-CQ-5213/DCSR.II/Mdu. dated 29.3.1996 on the fileof the Deputy Commissioner of Income Tax, Special Range-II, Madurai (TC(A) 1113/04). Mrs. Nalini Chidambaram, Senior counsel for Mrs. Pushya Sitaraman (Standing counsel for Income Tax):- For Applicants in all the T.Cs. except T.C.Nos. 62 to 64/2003 and for Respondents in T.C. Nos. 62 to 64/2003. Mr. C. Natarajan, Senior counsel for Mr. N. Inbarajan for Applicant in T.C.No. 62 to 64/2003. Mr. N. Quadir Hoseyn:- For Respondent in T.C. Nos. 144, 408, 409/99, 231/2001 and 435/2004. Mr. P.P.S. Janarthana Raja for M/s Subbaraya Aiyar:-For Respondent in T.C.Nos. 46/2000, 60, 61, 94, 95, 96, 156/2003, 9,53,82,123 to 125, 250, 262, 277, 342 and 436/2004. Mr. T.N. Seetharaman:- For Respondent in T.Cs. 30/2001, 54/2003 and 443/2004. Mr. R. Venkataraman, Senior counsel for Mr. J. Balachandar:- For Respondent in T.C.Nos. 48 and 124/2003. Mr. J. Balachandar for Mr. S. Sridhar:- For Respondent in T.C.Nos. 53/2003, 46, 312 and 317/2004. Mr. R. Meenakshisundaram:- For Respondent in T.C.No. 103/2004. Mr. N. Devanathan:- For Respondent in T.C.Nos. 363 and 364/2004. Mr.J.Balachander for Respondent in T.C.Nos. 202/2004. Mr. R. Srinivasan:- For Respondent in T.C.No. 224/2004. 212/2004, 285/2004, 327/2004, 486/2004 Mr. T.N. Seetharaman:- For Respondent in T.Cs. 30/2001, 54/2003 and 443/2004. Mr. R. Venkataraman, Senior counsel for Mr. J. Balachandar:- For Respondent in T.C.Nos. 48 and 124/2003. Mr. J. Balachandar for Mr. S. Sridhar:- For Respondent in T.C.Nos. 53/2003, 46, 312 and 317/2004. Mr. R. Meenakshisundaram:- For Respondent in T.C.No. 103/2004. Mr. N. Devanathan:- For Respondent in T.C.Nos. 363 and 364/2004. Mr.J.Balachander for Respondent in T.C.Nos. 202/2004. Mr. R. Srinivasan:- For Respondent in T.C.No. 224/2004. 212/2004, 285/2004, 327/2004, 486/2004 Since the Tax Case reference and Appeals relate to samequestion to be considered by this Court, all the above matters are beingdisposed of by the following common order. 2. T.C.No. 144/199 (Ref) relates to reference made byIncome-tax Appellate Tribunal, Madras Bench-B. By the ReferenceApplication, wherein the Commissioner of Income-tax, Madurai is theapplicant, and Messrs Janakiram Mills Ltd., Tenkasi Road, Rajapalayam isthe respondent, the Revenue requested the Income Tax Tribunal to refer thefollowing questions of law arising out of the order of the Tribunal dated19-12-97 to this Court for its opinion. They are: "1). Whether on the facts and in the circumstances of the case, the Tribunal is right in law in holding that theexpenditure incurred by the assessee during the accounting yearon the cost of carding system (Rs.31,22,679/-) was amount paidon current repairs and allowable under section 31 of the Income-tax Act? 2). Whether on the facts and in the circumstances ofthe case, the Appellate Tribunal was right in law in directingallowance of the entire amount of Rs.31,22,679/- as revenueexpenditure?" 3. For convenience we shall refer the facts in T.C.No.144/99. The assessee in that case had claimed that the expenditure of https://hcservices.ecourts.gov.in/hcservices/ Rs.31,22,679/- on replacement of carding system by high production cards,be treated as revenue expenditure for the assessment year 1986-87. TheAssessing Officer had negatived the assessee's claim. On appeal by theassessee, the C.I.T. (Appeals), following the decision of the AppellateTribunal in the cases of ITO v. SRI VARADHARAJA TEXTILES PVT. LTD., (9ITR 469) and the decision of the Supreme Court in the case of CIT v.MAHALAKSHMI TEXTILE MILLS LTD., (66 ITR 710) held that the expenditureincurred was only for replacement of part of the textile machinery andtherefore was allowable as revenue expenditure. Aggrieved by the order ofthe CIT (Appeals), the department had filed further appeal before theTribunal. The Tribunal after noting the inspection report and onverifying similar machineries installed in Indira Cotton Mills, Chennaiand after following earlier decision of the Tribunal on the same point,has treated the expenditure on carding machine as revenue expenditure andthus allowed the asessee's claim. Inasmuch as the second question raisedby the Revenue is covered by the first question, the Tribunal has referredonly the first question, as set out earlier, to this Court for its opinion. 4. Heard Mrs., Nalini Chidambaram, learned senior counselfor the Department; Mr. C. Natarajan, learned senior counsel forappellants in T.C.Nos. 62 to 64/2003, 93 and 251/2003; and Messrs N.Quadir Hoseyn, P.P.S. Janarthana Raja, T.N. Seetharaman, R. Venkataraman,J. Balachandar, R. Meenakshisundaram, N. Devanathan, and R. Srinivasan forrespondents. 5. The point for consideration is, whether themodernisation/current/repair expenditure is allowable as “revenueexpenditure”, as claimed by the assessees or the replacement of cards/blowroom machinery/combing machinery etc., are to be considered as “capitalexpenditure”, as claimed by the Revenue? 4. Heard Mrs., Nalini Chidambaram, learned senior counselfor the Department; Mr. C. Natarajan, learned senior counsel forappellants in T.C.Nos. 62 to 64/2003, 93 and 251/2003; and Messrs N.Quadir Hoseyn, P.P.S. Janarthana Raja, T.N. Seetharaman, R. Venkataraman,J. Balachandar, R. Meenakshisundaram, N. Devanathan, and R. Srinivasan forrespondents. 5. The point for consideration is, whether themodernisation/current/repair expenditure is allowable as “revenueexpenditure”, as claimed by the assessees or the replacement of cards/blowroom machinery/combing machinery etc., are to be considered as “capitalexpenditure”, as claimed by the Revenue? 6. The materials placed by both sides show that TextileMills, largely in Tamil Nadu, have been claiming the expenses relating topurchase of new machinery as current repairs/revenue expenditure, wherethe said purchase was as a part of modernisation programme or replacementof old machinery. It is the claim of the Department that the machineryreplaced in most of the cases are complete machinery, capable ofindependent operation. The Tribunal has allowed deduction as currentrepairs/revenue expenditure on the premise that: a. The entire textile mill should be treated as one single plant, and each machinery therefore is only a part of it. b. Wherever the spindlage or capacity has not increased due to the purchase of the new machinery in the place of the old one, it cannot be said that there is any enduring advantage. 7. Mrs. Nalini Chidambaram, learned senior counsel appearingfor the Department, would submit that most of the earlier decisions ofthis Court have gone on the presumption that what was replaced was a partof a machinery, and not the entire machine itself. For example, RingFrames, which are complete spinning machines consisting of severalspindles, have been erroneously assumed to be parts of machinery, and theexpenditure on replacement thereof has been allowed as a revenueexpenditure. 8. It is also her claim that the fact that replacement ofworn out machinery with new machinery results in an enduring benefit tothe assessee has not been considered either by the Tri