The Commissioner Of Income Tax,Chennai v. M/S.addison & Company Limited,803, Anna Salai, Chennai-600 002

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE HULUVADI G.RAMESHANDTHE HONOURABLE MR.JUSTICE K.KALYANASUNDARAM Tax Case Appeal No.109 of 2018 The Commissioner of Income tax,Chennai. ...Appellant -vs- M/s.Addison & Company Limited,803, Anna Salai, Chennai-600 002. ...Respondent Appeal filed under Section 260A of the Income Tax Act, 1961against the order of the Income Tax Appellate Tribunal, Madras'B' Bench, Chennai, dated 05.08.2016 made in ITA No.862/Mds/2016.Against the Commissioner of Income Tax (Appeals)-1 Chennai-600034, dt:05/10/2015 made in ITA.No.213/14-15 (New No:ITA 113/(IT(A)-1/2014-15) for the Assessment year-2011-12, and, Against the Assessment order of the Deputy Commissioner ofIncome -Tax, Company circle-I(1) Chennai, dt:27/03/2014 made inGIR/PAN Ax-1086 for the Assessment year.2011-12.For Appellant ::Mr.T.Ravikumar,Standing Counsel JUDGMENT (Delivered by HULUVADI G.RAMESH, J.) This Tax Case Appeal has been filed by the Revenue callingin question the correctness of the order passed by the IncomeTax Appellate Tribunal, Madras 'B' Bench, Chennai, dated05.08.2016 made in ITA No.862/Mds/2016, raising the followingsubstantial questions of law:"(i)Whether on the facts and in thecircumstances of the case, the Tribunal was right inholding that the balance depreciation is allowablein the 2[nd] year of acquisition of assets since only10% was claimed in the first year especially whenthere is no such express provisions in the I.T.Actto allow the balance left out additionaldepreciation in the subsequent years? https://hcservices.ecourts.gov.in/hcservices/ (ii)Is not the finding of the Tribunal bad byallowing the balance 50% of the depreciation in theyear other than the year of installation especiallywhen there is no provision under the Income tax Actfor carry forward of the balance depreciation andclaim the same? (iii)Whether on the facts and in thecircumstances of the case the Tribunal was right inupholding the order of CIT(A) in respect ofdevelopment charges claimed at 5% on the initiallumpsum paid which has given an enduring benefit tothe assessee and therefore was capital in nature andliable to be disallowed? (iv)Is not the finding of the Tribunal badespecially when the Development charges which wasclaimed at 5% on the lumpsum payment for acquiringlease right for 99 years is to be allowed as arevenue expenditure especially when the assessee hasnot capitalized the lumpsum paid in his accounts norhad claimed it as a revenue expenditure in the yearpayment made and therefore liable to be disallowed?” 2.When the matter is taken up for admission, the learnedStanding Counsel appearing for the appellant brought to ournotice the Circular instruction issued by the Central Board ofDirect Taxes vide Circular No.3/2018 dated 11.07.2018 wherein itis stipulated that appeals shall not be filed/pursued by theDepartment before the High Court in cases where the tax effectdoes not exceed Rs.50 lakhs. 3. In the instant case, the tax effect is less than themonetary limit imposed and therefore, the appeal is dismissed asnot pressed, preserving the substantial questions of law fordetermination in an appropriate case. No costs. KM To 1.The Income Tax Appellate Tribunal, Madras 'B' Bench, Chennai.Madras 'B' Bench, Chennai. 2.The Commissioner of Income-Tax, Chennai Chennai 3.The Commissioner of Income – Tax, (Appeals)-1, Chennai-34. 4.The Deputy Commissioner of Income -Tax,Company circle-I(1), Chennai Company circle-I(1), Chennai +1cc to Mr.T.Ravikumar, Advocate, S.R.No.75606+1cc to Mr.Subbaraya Aiyar, Advocate, S.R.No.76173Tax Case Appeal No.109 of 2018PA(CO)GSP(03/12/2018)