The Commissioner Of Income Tax,Chennai v. M/S.ramasays Corporation (P) Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 29.08.2019 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Tax Case Appeal No.702 of 2017 The Commissioner of Income tax,Chennai... Appellant -vs- M/s.Ramasays Corporation (P) Ltd.,No.18, L.G.N.Road, Chennai-600 002.PAN: .. Respondent Appeal under Section 260A of the Income-tax Act, 1961,againsttheorderdated31.05.2017,madeinI.T.A.No.282/Mds/2017 on the file of the Income Tax AppellateTribunal 'B' Bench, Chennai for the assessment year 2013-14. TCA.NO. 702 OF 2017: Against the order of the Commissioner ofIncome Tax (Appeals)-3, Chennai -34, dated 28.10.2016 made inITA.No. 162/2015-16/CIT (A)-3, against the Order of the DeputyCommissioner of Income Tax, Corporate Circle 5(1), Chennai – 34,dated 29.01.2016 made in PA/GIR No. AADCR8596A for theAssessment Year 2013-14. For Appellant:Ms.R.HemalathaSenior Standing Counsel This appeal filed by the Revenue under Section 260A of theIncome-tax Act, 1961 is directed against the order dated31.05.2017, made in I.T.A.No.282/Mds/2017 on the file of theIncome Tax Appellate Tribunal 'B' Bench, Chennai for theassessment year 2013-14. https://hcservices.ecourts.gov.in/hcservices/ 2.The appeal has been admitted on 15.12.2017, on thefollowing substantial questions of law:-“(i) Whether the Tribunal is right in treatingthe expenses incurred on cost of spares and toolsamountingtoRs.197,05,800/-asrevenueexpenditure especially when the said tools wereused by the assessee for producing parts whichtantamount to the cost of acquiring profit earningapparatus and not for operating the profit earningapparatus? and(ii) Whether the expenses incurred on sparesand tools used by the assessee for producing partsin the manufacture of industrial fastener iscapital expenditure or revenue expenditure?” 3.Heard Mr.T.Ravikumar and Ms.R.Hemalatha, learned SeniorStanding Counsel for the appellant – and Mr.Philip George,learned counsel for the respondent. 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.17/2019,dated 08.08.2019 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. Sd/-Assistant Registrar (CO)//True Copy// Sub Assistant Registrar abrTo 1.The Income Tax Appellate Tribunal 'B' Bench, Chennai. 2.The Commissioner of Income Tax (Appeals)3, Chennai-34. Chennai-34. 3.The Deputy Commissioner of Income Tax, Corporate Circle – 5 (1), Chennai – 34. Corporate Circle – 5 (1), Chennai – 34. +1cc to Mr.T.Ravi Kumar, Advocate, S.R.No. 74356+1cc to Mr.Philip George, Advocate, S.R.No. 75294 T.C.A.No.702 of 2017NMI(CO)GN(12/11/2019)