PRINCIPAL COMMISSIONET OF IN vs. I.P. RINGS LTD,

T.C.A.Nos.1021 & 1022 of 2019 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 20.12.2019 CORAM : THE HONOURABLE MR.JUSTICE N.KIRUBAKARAN and THE HONOURABLE MR.JUSTICE P.VELMURUGAN T.C.A.Nos.1021 & 1022 of 2019 and C.M.P.No.26646 of 2019 Principal Commissioner of Income Tax, No.121, Nungambakkam High Road, Chennai 600 034.

... Appellant in both appeals Vs M/s.I.P.Rings Ltd., No.24, Arjay Apex Centre, College Road, Chennai - 600 006. ...Respondent in both appeals COMMON PRAYER: Tax Case Appeals filed under Section 260A of Income Tax Act, 1961 against the order dated 28.07.2017 in I.T.A.Nos.2583 & 2584/Mds/2016 on the file of the Income Tax Appellate Tribunal Chennai 'C' Bench for the assessment years 2010-11 & 2011-2012. For Appellant : Mr.Karthik Ranganathan, Senior Standing Counsel. For Respondent : Mr.Venkat Narayanan for M/s.Subbaraya Aiyar Padmanabhan Ramanani. 1/6 http://www.judis.nic.in T.C.A.Nos.1021 & 1022 of 2019 C O M M O N J U D G M E N T (Judgment of the Court was delivered by N.KIRUBAKARAN, J) These tax case appeals have been filed against the order of the Income Tax Appellate Tribunal dated 28.07.2017 in I.T.A.Nos.2583 & 2584/Mds/2016 in dismissing the appeal filed by the Revenue against the order of the Commissioner of Income Tax (Appeals) by which the appeal filed by the assessee was partly allowed. 2.Heard Mr.Karthik Ranganathan, learned Senior Standing Counsel for the appellant and Mr.Venkat Narayanan, learned Counsel for the respondent. 3.These tax case appeals are admitted on the following substantial questions of law: "(i)Whether on the facts and in the circumstances of the case and in law, the ITAT was right in holding that 75% of the royalty payments are to be treated as revenue is nature? (ii)Whether on the facts and in the circumstances of the case and in law, the ITAT was right in not considering the fact that as per Explanation 3(b) to Sec.32(1) of the 2/6 http://www.judis.nic.in T.C.A.Nos.1021 & 1022 of 2019 Income Tax Act, intangible asset eligible for depreciation @ 25% and therefore the royalty paid for such intangible asset was a capital expenditure? (iii)Whether on the facts and in the circumstances of the case and in law, the ITAT was right in ignoring the fact that the benefit acquired by the assessee under the Technical Assistance Agreement between the assessee and NPR was a benefit of enduring nature and therefore the expenses incurred towards the same was only a capital expenditure and not revenue expenditure? (iv)Whether on the facts and in the circumstances of the case and in law, the ITAT was right in allowing the balance of the additional depreciation carried forward from the earlier assessment year. (v)Whether on the facts and in the circumstances of the case and in law, the ITAT was right in not appreciating the fact that as per the provision to Section 32(1)(iia) of the Act where the asset is acquired and put to use by the assessee for the purpose of business for a period of less than one hundred and eighty days in that previous of business for a period of less than one hundred and eighty days in that previous year deduction under this Sub-section shall be restricted to fifty per cent to such asset?"

(N.K.K.,J.) (P.V.,J.) 20.12.2019 ay To Principal Commissioner of Income Tax, No.121, Nungambakkam High Road, Chennai 600 034. N.KIRUBAKARAN, J. and 5/6 http://www.judis.nic.in T.C.A.Nos.1021 & 1022 of 2019 P.VELMURUGAN, J. ay T.C.A.Nos.1021 & 1022 of 2019 and C.M.P.No.26646 of 2019 Dated:20.12.2019 6/6 http://www.judis.nic.in