THE COMMISSIONER OF vs. M/S.PREMIER TOBACCO PACKERS

T.C.A.No.200 of 2016 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED 23.08.2022 CORAM THE HON'BLE Mr. JUSTICE R. MAHADEVAN AND THE HON'BLE Mr. JUSTICE MOHAMMED SHAFFIQ Tax Case Appeal No.200 of 2016 The Commissioner of Income Tax Chennai

.. Appellant Vs. M/s.Premier Tobacco Packers Pvt. Ltd. No.2B, Pioneer Homes No.115A, Sir P.S.Sivasami Salai Mylapore, Chennai 600 004 PAN : AAACP4232G .. Respondent Tax Case Appeal filed under Section 260A of the Income Tax Act, 1961 against the order dated 29.09.2015 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, in I.T.A.No.703/Mds/2014. For Appellant : Mr.T.Ravikumar Senior Standing Counsel For Respondent : Mr.S.Sridhar 1/4 https://www.mhc.tn.gov.in/judis T.C.A.No.200 of 2016 J U D G M E N T (Judgment was delivered by R. MAHADEVAN, J.) This tax case appeal has been filed by the appellant/Revenue, calling in question the correctness of the order dated 29.09.2015 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, in I.T.A.No.703/Mds/2014, relating to the assessment year 2005-06. 2. By order dated 21.03.2016, this Court admitted the aforesaid tax case appeal on the following substantial questions of law : “(i) Whether on the facts and circumstances of the case, the Tribunal was Justified in hiding that a sum of Rs.18,84,633/- incurred on account of solvent extraction plant is revenue expenditure and allowable? (ii) Is not the finding of the Tribunal bad by holding that expenditure of Rs.18,84,633/- is not capital in nature especially when the low purity crude solanesol all produced on trial run basis before commencement of commercial production? and (iii) Whether the finding of the Tribunal is proper by holding that the expenses were revenue in nature especially when the oil solvent extraction plant was done on trial run and the balance sheet of the assessee company had only disclosed that the company has started its oil division by producing 11660 kg of low purity crude solanesol on trial run basis before commencing commercial production and no sales were effected and no income was disclosed in the profit and less account, which will all clearly show that it was only capital expenditure and not revenue?” 2/4 https://www.mhc.tn.gov.in/judis T.C.A.No.200 of 2016 3. When the matter was taken up for consideration, the learned Standing Counsel for the appellant/Revenue brought to the notice of this court the Circular No.17/2019 dated 08.08.2019, issued by the Central Board Direct Taxes, wherein, it is stipulated that appeal shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). It is also submitted that the tax effect in this appeal is less than the threshold limit. 4. In the light of the aforesaid submissions made by the learned Standing Counsel for the appellant/Revenue, the present appeal, wherein, the tax effect is said to be less than the monetary limit imposed, is dismissed as withdrawn, keeping open the substantial questions of law for determination in an appropriate case. No costs. [R.M.D,J.] [M.S.Q, J.] 23.08.2022 Internet : Yes gya 3/4 https://www.mhc.tn.gov.in/judis T.C.A.No.200 of 2016 R. MAHADEVAN, J. AND MOHAMMED SHAFFIQ, J. gya To 1.The Assistant Commissioner of Income Tax Company Circle-V(2) Chennai 2.The Commissioner of Income Tax (Appeals)-V Chennai 3.The Income Tax Appellate Tribunal 'B' Bench, Chennai Tax Case Appeal No.200 of 2016 23.08.2022

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